Franklin Resources, Inc.
BENFranklin Resources is a high gross margin asset manager whose long-term fate depends on defending fees in a world shifting toward cheaper investing.
Because small changes in fees and investor behavior can dramatically reshape its profits over decades.
Business Model
Manage assets for a fee
It invests client money in funds and earns a percentage of assets under management each year.
Economic Engine
High gross margins
Gross margin sits at 80.3 percent, but operating margin has shrunk to 6.9 percent under cost pressure.
Long-Term Lens
Fee durability
The key question is whether it can maintain pricing power as investors shift to low-cost index funds.
BinaPrint Snapshot
Style
Harvest
Fitness
Stressed
Updated Mar 8, 2026
On this page
Company Story
How do Franklin Resources, Inc.'s business model and economics hold up on a closer read?
Start with the business itself, then go one layer deeper into the model, the economics, and the long-term case.
“A cash-generating but structurally pressured asset manager that must reinvent itself to avoid a slow 20-year fade.”
What does Franklin Resources, Inc. actually do?
Franklin Resources manages mutual funds, exchange traded funds, and other investment products for individuals and institutions.
- Runs actively managed stock and bond funds under brands like Franklin and Templeton
- Offers alternative investments and specialty strategies
- Serves financial advisors, retirement accounts, and institutional clients
Why it matters
Revenue depends on assets under management
If client assets grow, fees grow. If assets leave or markets fall, revenue shrinks.
How does Franklin Resources, Inc. make money?
It charges a management fee that is usually a small percentage of the money it manages.
- Fees are based on total client assets, not on fund performance alone
- Most costs are fixed, such as staff and technology
- When assets fall, profit can drop quickly because expenses do not fall as fast
Economic clue
Margins are under strain
Gross margin is 80.3 percent, but operating margin has compressed to 6.9 percent, showing rising cost pressure.
Why do long-term investors keep Franklin Resources, Inc. on the radar?
Asset managers can be powerful cash machines if they retain client trust and protect their fee base.
- Free cash flow is 1.74 times net income, showing strong cash conversion
- Five year average revenue growth is only 1.0 percent, signaling stagnation
- Earnings per share have fallen an average of 29.0 percent per year over five years
Investor takeaway
A turnaround story, not a growth engine
Long term returns will depend more on stabilizing assets and margins than on rapid expansion.
Based on company financial statements.
What Could Change The Story
- Broke would move the profile toward Yield.
- Turnaround complete would move the profile toward Vault.
Benchmark Comparison
How has Franklin Resources, Inc. performed against common long-term benchmarks?
Once the business case is clear, compare the stock against broad market and alternative long-term baselines.
$991.31
-0.9% total return
$1,753
+75.3% total return
$2,975
+197.5% total return
$1,393
+39.3% total return
| Asset | Total Return | Dollar Value |
|---|---|---|
| BEN | -0.9% | $991.31 |
| S&P 500 | +75.3% | $1,753 |
| Gold | +197.5% | $2,975 |
| Bitcoin | +39.3% | $1,393 |
From Mar 5, 2021 to Mar 6, 2026. Historical price data based on company financial statements and market indices. Each card uses the same starting amount so the comparison stays apples-to-apples.
Investor Fit
How a first-time investor could frame Franklin Resources, Inc.
Before going deeper, decide what kind of business this is, what it tends to suit, and what deserves monitoring over time.
This Can Fit If You Want
- Exposure to traditional asset management with potential for operating leverage if markets rise
- A company that generates more cash than its accounting earnings suggest
- A turnaround candidate trading on a compressed margin base
Be Careful If You Expect
- Consistent double digit revenue growth over the next decade
- Expanding profit margins without structural industry change
- Strong pricing power in a world moving toward low-cost passive funds
What To Watch Over Time
- Trends in total assets under management and net client inflows or outflows
- Operating margin recovery from the current 6.9 percent level
- How management deploys cash, especially around acquisitions and buybacks
BinaPrint Position
Where does Franklin Resources, Inc. sit on the BinaPrint map right now?
Test whether business quality and financial profile match the company's stated narrative.
Advanced BinaPrint details
Open the axes, investor fit, and risk framing behind this profile.
Key Metrics
Which metrics matter most for Franklin Resources, Inc. right now?
Three durable business metrics that matter more than day-to-day price moves.
1.0% five-year average
-29.0% five-year average
80.3% gross margin
| Metric | Value | Context |
|---|---|---|
| Revenue Growth | 1.0% five-year average | Shows that the business has barely grown over a full market cycle. |
| EPS Growth | -29.0% five-year average | Indicates earnings per share have sharply declined over time. |
| Margin Quality | 80.3% gross margin | Reveals the core service is high margin before overhead and distribution costs. |
Based on company financial statements.
Fundamentals
What do Franklin Resources, Inc.'s fundamentals say right now?
Core financial markers that explain how the business is performing beneath the stock price.
5.2% ROIC
80.3% gross margin
10.4% FCF margin
Stable to shrinking
| Metric | Value | Interpretation |
|---|---|---|
| Capital Efficiency | 5.2% ROIC | The business is currently showing poor capital efficiency. |
| Profitability | 80.3% gross margin | Healthy gross margins give the company room to invest, price competitively, and absorb shocks. |
| Cash Generation | 10.4% FCF margin | Free cash flow margin shows how much real cash the business keeps after funding operations and investment. |
| Ownership Trend | Stable to shrinking | The company is not currently diluting owners and may be buying back shares instead. |
Based on company financial statements.
Included In Funds
Which ETFs and funds currently hold Franklin Resources, Inc.?
Franklin Resources, Inc. currently appears in these ETF and fund proxies.
SPY
SPDR S&P 500 ETF Trust
IWB
iShares Russell 1000 ETF
Questions & Answers
What questions come up most often about Franklin Resources, Inc.?
Company-specific questions readers often ask about Franklin Resources, Inc..
Each entry answers a direct question about the business, the long-term thesis, or the risks that matter over time.
Franklin Resources manages mutual funds, exchange traded funds, and other investment products and earns fees based on the assets it oversees.
Decision Framing
Secondary context after the long-term thesis
Shorter-horizon context and comparison tools, after the core long-term read.
Shorter-horizon price moves, two-sided debate, and comparison tools live here so the page stays anchored on business quality, durability, and BinaPrint fit first.
Investment Thesis
Bull vs Bear
Two-sided framing before any decision.
Current argument weight is balanced.
Bull case
What can work
If markets rise over the next 20 years, assets under management can grow even without strong net inflows, providing operating leverage on largely fixed costs.
An aging global population continues to shift savings into retirement accounts and managed products, supporting long term demand for professional asset management.
The company’s 80.3 percent gross margin shows that the core service is inherently profitable if costs are controlled.
Strong cash conversion, with free cash flow at 1.74 times net income, gives management room to reinvest or repurchase shares opportunistically.
Bear case
What can break
The long term shift toward ultra low cost index funds could permanently compress fees, reducing revenue even if assets stay flat.
Technology driven platforms and robo advisors may capture younger investors, weakening Franklin’s traditional advisor distribution network.
If operating margin remains near 6.9 percent or falls further, the business could struggle to earn attractive returns on capital over decades.
Market downturns can quickly shrink assets under management, and with largely fixed costs, profits can evaporate in prolonged bear markets.
Risk Radar
Key Risks
Where downside pressure can build.
Fee compression: Even a 0.10 percent average fee reduction across large asset bases could materially cut revenue and push net margin below the current 6.0 percent.
Market sensitivity: Revenue growth of 3.5 percent year over year can reverse quickly if equity and bond markets decline, reducing assets under management.
Earnings erosion: Five year average earnings per share decline of 29.0 percent per year shows how vulnerable profits are to structural pressure.
Sizing matters
Risks should be read as scenario inputs, not certainties. Position size and time horizon determine how much of this downside profile is acceptable.
Market Snapshot
Tactical context after the core long-term read.
- Price
- $26.24
- Daily move
- -2.53%
Peer Set
A compact peer list for side-by-side context.
Next Actions
Explore planning scenarios or keep browsing similar companies.