There has been growing resentment against big financial companies over the past year, but Franklin Resources isn't your average love `em and leave `em financial services firm.
With estimated earnings growth of 62% for 2010, low debt ratios, and solid cash flows, there's a lot to love about Franklin.
The San Mateo, California-based investment management company, which had $553.5 billion assets under management at December 31, 2009, was #1 on the annual list of the top U.S. mutual fund families from Barron's for the 2nd year in a row. The list ranks funds based on average returns.
And the stock is still attractive for investors that prefer brains to brawn. With less than 50% of investments in equities and a strong portfolio of international funds, analysts say Franklin is smartly diversified. That "bodes well for an uncertain environment, giving it the staying power to grow and expand in all markets," said Daniel Fannon, a research analyst at Jefferies & Co.
Franklin's stock, at about 16 times earnings estimates, isn't as cheap as some of its money manager competitors, but Mark Lane, a research analyst at William Blair & Company, likes Franklin because it is growing faster than its rivals. That makes it a good value. Who doesn't love that?
--Chavon Sutton
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