Franklin Resources, Inc.BEN seems to be on track with its efforts to enhance shareholders' value. The California-based asset manager announced an additional repurchase authorization of up to 50 million shares.
Notably, the new authorization, which does not have any expiration date, is an addition to the existing share buyback program under which 12.6 million shares remained outstanding for repurchase as of May 31, 2016. During the period from Oct 2015 to May 2016, the company repurchased around 24.6 million shares.
Separately, Franklin announced a quarterly cash dividend of 18 cents per share, which will be paid on Jul 15, 2016 to shareholders on record as of Jun 30, 2016.
Driven by a healthy liquidity position, the company is committed to increase shareholders' wealth through dividend payments and share buybacks. Notably, Franklin has consistently hiked dividends every year since its inception in 1981, the latest being a 20% increase in Dec 2015.
With a strong liquidity and balance sheet position, we believe Franklin will continue to reward its shareholders. As of Mar 31, 2016, cash and cash equivalents along with investments were $10.6 billion.
While assets under management (AUM) exhibited a decline in May 2016 compared to the previous month, Franklin, as a high quality asset manager shows good prospects of long-term performance, flows and profitability, and substantial leverage for international AUM growth.
Currently Franklin carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the finance space include LPL Financial Holdings Inc. LPLA , Union Bankshares Corporation UBSH and First Bancorp FBP , each sporting a Zacks Rank #1 (Strong Buy).
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