Core Insights - The Artificial Intelligence explosion has been a primary focus for investors over the past three years [1] Industry Summary - The rapid growth and interest in Artificial Intelligence have significantly influenced investment strategies and market dynamics [1]

Core Insights - Franklin Templeton Canada announced cash distributions for certain ETFs and mutual fund series, with payments scheduled for December 8, 2025, for unitholders of record as of November 28, 2025 [1][2] Cash Distributions - The following ETFs will provide cash distributions per unit, all payable monthly: - Franklin Brandywine Global Income Optimiser Fund – ETF Series: $0.074210 [2] - Franklin ClearBridge Global Infrastructure Income Fund – ETF Series: $0.036925 [2] - Franklin Canadian Government Bond Fund – ETF Series: $0.049997 [2] - Franklin Canadian Ultra Short Term Bond Fund – ETF Series: $0.056045 [2] - Franklin Canadian Corporate Bond Fund – ETF Series: $0.056014 [2] - Franklin Canadian Core Plus Bond Fund – ETF Series: $0.044003 [2] - Franklin Global Core Bond Fund – ETF Series: $0.046897 [2] - Franklin Canadian Short Term Bond Fund – ETF Series: $0.048440 [2] - Franklin Canadian Low Volatility High Dividend Index ETF: $0.757439 [2] - Franklin U.S. Low Volatility High Dividend Index ETF: $0.048319 [2] Estimated Annual Reinvested Distributions - Unitholders of record on December 30, 2025, will receive estimated annual reinvested distributions payable on January 8, 2026, with final amounts to be announced on December 19, 2025 [3][4] - Notable estimated annual reinvested distributions include: - Franklin U.S. Core Equity Fund – ETF Series: $1.041355 [4] - Franklin International Core Equity Fund – ETF Series: $0.694137 [4] - Franklin Global Growth Fund – ETF Series: $0.599321 [4] Tax Implications - Annual reinvested distributions will be reported as taxable distributions, increasing each unitholder's adjusted cost base of their units [5] - Actual taxable amounts for cash and reinvested distributions for 2025 will be reported to brokers in early 2026 [6] Company Overview - Franklin Templeton is a global investment management organization with over 75 years of experience and $1.69 trillion in assets under management as of October 31, 2025 [8] - The company offers a diverse range of ETFs, including active, smart beta, and passive options across multiple asset classes and geographies [7]

Core Insights - Franklin Resources (BEN) is actively expanding through acquisitions and partnerships to enhance its alternative investments and multi-asset solutions offerings [2][11] - The acquisition of Apera Asset Management significantly increased BEN's alternative credit assets under management (AUM) by over $90 billion, bringing total alternative asset strategies to nearly $270 billion as of September 30, 2025 [3] - The company is focusing on higher-growth asset classes, particularly alternatives, to capture incremental flows and support long-term AUM expansion [7] Strategic Acquisitions and Partnerships - In October 2025, Franklin Resources completed the acquisition of Apera Asset Management, enhancing its position in the alternative credit market [3] - In September 2025, Franklin partnered with Copenhagen Infrastructure Partners, DigitalBridge, and Actis to expand its private infrastructure platform [4] - In July 2024, Franklin collaborated with SBI Holdings to enter the ETF and digital assets space, targeting younger investors [5] - The acquisition of Putnam Investments in January 2024 boosted Franklin's defined-contribution AUM above $100 billion [5] Market Position and Competitiveness - Franklin's strategic moves have strengthened its presence in the separately managed account (SMA) market and expanded its capabilities across private debt, real estate, hedge funds, and private equity [6] - The company's focus on alternatives aligns with industry trends, enhancing its competitive positioning and potential for sustained revenue growth [7] - Peers like BlackRock and T. Rowe Price are also pursuing similar inorganic growth strategies through acquisitions and partnerships [8][12] Financial Performance and Valuation - Franklin's shares have increased by 1.7% over the past three months, contrasting with an 18.2% decline in the industry [14] - The company trades at a forward price-to-earnings (P/E) ratio of 8.71X, below the industry average of 13.98 [16] - The Zacks Consensus Estimate indicates year-over-year earnings growth of 12.6% and 12.5% for 2026 and 2027, respectively, although recent estimates have been revised downward [18]

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1][2] Zacks Style Scores - Zacks Style Scores are indicators that help investors select stocks likely to outperform the market in the next 30 days, rated from A to F based on value, growth, and momentum [2][7] - The Value Score identifies undervalued stocks using financial ratios like P/E and Price/Sales [3] - The Growth Score focuses on a company's future prospects by analyzing earnings, sales, and cash flow [4] - The Momentum Score helps investors capitalize on price trends using recent price changes and earnings estimate shifts [5] - The VGM Score combines all three Style Scores to identify stocks with attractive value, growth potential, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to simplify portfolio building [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +23.93% since 1988, significantly outperforming the S&P 500 [8] - There are over 800 stocks rated 1 or 2, making it essential to utilize Style Scores for better stock selection [9] Stock Example: Franklin Resources (BEN) - Franklin Resources, Inc. is a global investment management company with diverse brands and services [12] - BEN holds a 3 (Hold) Zacks Rank and a VGM Score of B, indicating potential for growth [13] - The company is forecasted to achieve year-over-year earnings growth of 12.6% for the current fiscal year, with a Zacks Consensus Estimate of $2.50 per share [13][14]

Market Overview - The Australian share market experienced modest gains across major indexes, with the S&P/ASX 200 closing at 8818.80, down 0.2% from 8835.90 [1][7] - The S&P/ASX 20, S&P/ASX 50, and S&P/ASX 100 also saw declines of 0.8%, 0.4%, and 0.3% respectively [1][7] - The broader S&P/ASX 300 fell 0.2% to finish at 8769.90 from 8784.60 [1][7] Top Gainers - Light & Wonder Inc. (LNW) led the S&P/ASX 200 gainers, rising $13.75, or 10.99%, to close at $138.82 [2][7] - Liontown Resources Limited (LTR) climbed $0.09, or 7.83%, finishing at $1.24 [2][7] - Pilbara Minerals Limited (PLS) added $0.24, or 7.50%, reaching $3.44 [2][7] - Bega Cheese Limited (BGA) advanced $0.35, or 6.55%, closing at $5.69 [2][7] - Mineral Resources Limited (MIN) rose $2.64, or 5.96%, ending at $46.92 [2][7] Top Decliners - Bendigo and Adelaide Bank Limited (BEN) saw the largest decline, dropping $1.08, or 8.49%, to $11.64 [3][7] - Commonwealth Bank of Australia (CBA) fell $11.52, or 6.59%, closing at $163.40 [3][7] - Life360 Inc. (360) slid $2.52, or 5.22%, to $45.80 [3][7] - IperionX Limited (IPX) declined $0.19, or 3.20%, to $5.74 [3][7] - Breville Group Limited (BRG) slipped $0.69, or 2.28%, to $29.58 [3][7] Futures Market - The S&P/ASX 200 Futures for December 2025 fell 48.0 points, or 0.54%, to 8,843.5, indicating a softer market outlook [5][7]

Assets Under Management (AUM) - As of September 30, 2025, Franklin Resources, Inc. has over $1.6 trillion in assets under management (AUM) across various investment strategies[19]. - The AUM by asset class includes $851.4 billion in equity (41%), $438.7 billion in fixed income (26%), $263.9 billion in alternatives (16%), $193.9 billion in multi-asset (12%), and $78.5 billion in cash management (5%)[29]. - Total Assets Under Management (AUM) was $1,661.2 billion as of September 30, 2025, a 1% decrease from $1,678.6 billion at September 30, 2024[179]. - Average AUM increased by 3% during fiscal year 2025, reaching $1,606.7 billion compared to $1,565.8 billion in fiscal year 2024[186]. - AUM decreased by $17.4 billion or 1% during fiscal year 2025, primarily due to $97.4 billion of long-term net outflows, partially offset by $67.6 billion of net market change and $12.6 billion of cash management net inflows[191]. - AUM in the United States remained stable at $1,171.5 billion for 2025, while total international AUM decreased by 2% to $489.7 billion[193]. Financial Performance - Operating revenues for fiscal year 2025 were $8,770.7 million, representing a 3% increase from $8,478.0 million in fiscal year 2024[187]. - Net income attributable to Franklin Resources, Inc. was $524.9 million for fiscal year 2025, a 13% increase from $464.8 million in fiscal year 2024[187]. - Diluted earnings per share for fiscal year 2025 were $0.91, up 7% from $0.85 in fiscal year 2024[187]. - Total operating revenues for fiscal year 2025 were $8,770.7 million, reflecting a 3% increase compared to $8,478.0 million in 2024[200]. Investment Management Fees - Investment management fees, which represent a majority of revenues, are based on a percentage of AUM and vary by asset class and service type[28]. - Investment management fees increased by $159.6 million in fiscal year 2025, primarily due to one additional quarter of revenue from Putnam and an increase in average equity AUM[202]. - Performance fees rose to $474.0 million in fiscal year 2025, up from $390.7 million in 2024, driven by changes in performance fees from alternative investment managers[204]. - Shareholder servicing fees increased by $35.2 million in fiscal year 2025, mainly due to one additional quarter of fees from Putnam and higher related AUM[212]. - The effective investment management fee rate excluding performance fees was 40.5 basis points for fiscal year 2025, a decrease from 41.1 basis points in 2024[203]. Regulatory Environment - The company operates in a complex regulatory environment, which adds to the challenges of compliance and operational efficiency[22]. - Regulatory compliance is extensive, with the company subject to various U.S. federal and state laws, including the Securities Act of 1933 and the Dodd-Frank Act[59]. - The SEC's amended rules require public companies to disclose material cybersecurity incidents within four business days, impacting the company's reporting obligations[63]. - Sustainability and ESG topics are under increased regulatory scrutiny, with new climate disclosure rules being considered that may affect future reporting[64]. - The SEC and CFTC adopted amendments to Form PF in February 2024, requiring private fund advisers to report additional information including assets under management and fund performance, with compliance extended to October 2026[69]. - The DOL's 2024 amended fiduciary rule broadens the definition of "investment advice fiduciary," impacting financial services providers and potentially subjecting them to ERISA fiduciary standards[68]. Market Conditions and Competition - The financial services industry is highly competitive, with competition based on factors such as investment performance, product offerings, and service quality[51]. - Market conditions, including geopolitical risks and economic crises, can adversely affect investment performance and AUM[98]. - The investment management industry is experiencing transformative pressures, including increased fee pressure and a shift towards alternative and passive strategies, which could affect the company's competitive position[113]. - The company competes with numerous investment management firms, and increased competition could lead to a decline in market share and revenues[114]. Operational Risks - The company faces operational risks related to compliance with regulatory requirements and the complexity of its global operations[107]. - The company faces risks associated with inadequate controls and risk management policies, which could adversely affect its global operations and financial position[108]. - The company is investing in a third-party technology solution to unify its investment management technology platform, which may require significant capital spending[122]. - Any significant failure or security breach in the company's information and cybersecurity infrastructure could disrupt operations and harm its financial condition[123]. - The company faces significant cybersecurity risks, including potential financial losses and reputational harm due to system disruptions or breaches[126]. Employee and Workplace - As of September 30, 2025, the company employed approximately 9,800 employees and operated offices in over 30 countries[93]. - The company has established resources to promote an inclusive workplace and drive employee engagement, which is critical for long-term success[94]. - Key personnel are critical to the company's success, and losing them could adversely affect client retention and financial performance[130]. Real Estate and Assets - The company has a total of 2,677,753 square feet of owned properties, with 1,093,776 square feet leased to third parties[158]. - As of September 30, 2025, the company leased and occupied approximately 2,022,000 square feet of office space worldwide[158].

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Core Insights - Franklin Resources Inc. reported fourth-quarter fiscal 2025 adjusted earnings of 67 cents per share, exceeding the Zacks Consensus Estimate of 57 cents per share and improving from 59 cents in the prior year [1][9] - The company's results were driven by higher revenues, improved assets under management (AUM), and lower expenses [1][11] Financial Performance - For fiscal 2025, total operating revenues increased by 3.4% year over year to $8.77 billion, surpassing the Zacks Consensus Estimate of $8.55 billion [3] - In the fourth quarter, total operating revenues rose by 5.9% year over year to $2.34 billion, exceeding the Zacks Consensus Estimate of $2.12 billion [3][9] - Investment management fees increased by 5.8% year over year to $1.87 billion, while sales and distribution fees rose by 3.9% to $382.4 million [4] - Total operating expenses decreased by 4.4% year over year to $2.26 billion, attributed to reductions in various costs [5] Assets Under Management - As of September 30, 2025, total AUM was $1.66 trillion, reflecting a sequential increase of 3.1% [6] - The average AUM for the quarter was $1.63 trillion, up 4.3% sequentially [6] Capital Position - As of September 30, 2025, cash and cash equivalents and investments totaled $6.7 billion, with total stockholders' equity at $13.0 billion [7] Shareholder Actions - In the reported quarter, the company repurchased 2.6 million shares for $67.1 million [10]

Financial Data and Key Metrics Changes - For Q4 2025, ending AUM reached $1.66 trillion, a 3.1% increase from the prior quarter, while average AUM increased by 4.4% to $1.63 trillion [31] - Adjusted operating revenues increased by 13.9% to $1.82 billion from the prior quarter, driven by elevated performance fees and higher average AUM [31] - Adjusted net income and adjusted diluted earnings per share increased by 35.7% and 36.7% from the prior quarter to $357.5 million and $0.67, respectively [32] Business Line Data and Key Metrics Changes - In public markets, over 50% of mutual funds, ETFs, and composites outperformed peers and benchmarks across all standard time periods, indicating improved investment performance [9] - Private markets saw fundraising of $22.9 billion, contributing to a total of $270 billion in alternative AUM, with expectations to increase fundraising to between $25 billion and $30 billion in fiscal 2026 [11] - The SMA business grew at a 21% compound annual rate since 2023, with AUM of $165 billion across more than 200 strategies [15] Market Data and Key Metrics Changes - Internationally, Franklin Templeton managed nearly $500 billion in assets, achieving $10.7 billion in positive long-term net flows in markets outside the U.S. [26] - Fixed income net inflows were $17.3 billion for the year, with positive net flows for seven consecutive quarters [28] - Alternatives and multi-asset generated $25.7 billion in net flows for the year, reflecting broad-based client demand [29] Company Strategy and Development Direction - The company is focused on deepening client partnerships, broadening investment capabilities, and strengthening its diversified model as part of a five-year plan [7] - Franklin Templeton aims to democratize private assets and expand its wealth management offerings, targeting to double Fiduciary's AUM by 2029 [20] - The company is investing in innovation, particularly in digital assets and AI, to redefine how investors access opportunities and improve operational efficiency [22] Management's Comments on Operating Environment and Future Outlook - The management expressed optimism about the strong public equity gains and the overall constructive view of private markets, despite a complex geopolitical backdrop [24] - The company anticipates continued growth in alternatives, particularly in the retail market, driven by partnerships and innovative product offerings [13] - Management highlighted the importance of selectivity and discipline in navigating the current market dynamics, which present opportunities across public and private markets [25] Other Important Information - Franklin Templeton was named 2025 Asset Manager of the Year in the $500 billion-plus AUM category, reflecting its leadership in innovation and investment advisory solutions [7] - The company has integrated certain corporate functions to drive efficiency and enhance client service, particularly in response to challenges faced by Western Asset Management [29] - The firm is focused on capital management, returning $930 million to shareholders through dividends and share repurchases [36] Q&A Session Summary Question: Fundraising target for fiscal 2026 - The target is between $25 billion and $30 billion, with contributions expected from various funds including Lexington, Clarion, and Alcentra [43] Question: Expense guidance for 2026 - The company expects to achieve $200 million in cost savings for 2026, with a focus on maintaining or reducing total expenses compared to fiscal 2025 [44][46] Question: Infrastructure product pipeline - The company is building a fund around partnerships with DigitalBridge, Copenhagen Infrastructure Partners, and Actis to participate in infrastructure deals [48] Question: AI and tokenization opportunities - The company is leading in tokenization, offering unique features for money market funds and exploring new distribution capabilities through partnerships with exchanges like Binance [51][53] Question: Update on Lexington flagship fund - The target size for the Lexington flagship fund is about $25 billion, with expectations for the first close in the first half of 2026 [54]

AUM and Flows - Ending AUM was $16612 billion, a decrease of 1% compared to the prior year[7,9,11] - Long-term inflows increased 78% year-over-year to $3439 billion[7,48] - Long-term net outflows were $974 billion, compared to $326 billion in the prior year[7] - Excluding Western Asset Management, long-term net inflows were $445 billion, compared to $160 billion in the prior year[7] - ETF AUM increased by 56% to $491 billion with $137 billion of net inflows[7] - Retail SMA AUM increased by 13% to $1645 billion with $27 billion in net inflows[7] - Canvas® AUM increased by 71% to $163 billion with $47 billion of net inflows[7] Financial Performance - Adjusted revenue increased 21% year-over-year to $67011 million[9,11,12] - Adjusted operating income decreased 43% year-over-year to $16402 million[9,11,12] - Adjusted net income decreased 63% year-over-year to $11958 million[9,11,12] - Adjusted diluted EPS decreased 75% year-over-year to $222[9,11,12] Alternatives - Alternative AUM increased to $2639 billion after $139 billion in realizations and distributions[7] - Fundraised $262 billion in alternatives, including $229 billion in private markets[7,17] Capital Management - Returned $930 million to shareholders through dividends ($690 million) and share repurchases ($240 million)[15] - Cash and investments totaled $674 billion[10,12]