Citi Rates Franklin Resources (BEN) Low Risk

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Citi Investment Research & Analysis analysts William R Katz and Neil Stratton rated shares of Franklin Resources Inc (NYSE: BEN) a Low Risk, with a target price of $132 per share.

The analysts forecast that Franklin Resources Inc would book net inflows of $3 billion to $4 billion.

They said that Franklin Resources' new business growth "will be lead by global fixed income volumes and building institutional volumes."

However, they also said that the company's results would be held back by the retail slowdown.

The Citi Investment Research & Analysis analysts wrote, "Our target price on BEN is $132. We value the shares of Franklin Resources using the Target P/E method. We use a target P/E multiple of 17.5x applied to our calendar 2010E EPS estimate plus $19 per share in net cash and investments. The 17.5x target multiple is about in-line with the firm's 16.4 historical FTM P/E multiple. Given an improving business mix and higher systemic margin potential, we believe BEN should trade beyond its LT average, particularly given low nominal interest rates globally."