Franklin Resources (BEN) announced a 3.7% hike in its quarterly dividend to $0.28 per share from $0.27. The investment management company has raised its dividend annually since 1981.
Franklin Resources said that the new dividend will be paid on Jan. 15, 2021, to shareholders of record as of Dec. 31, 2020. The company’s annual dividend of $1.12 per share now reflects a dividend yield of 2.1%.
Earlier in October, Franklin Resources reported mixed 4Q results. Its adjusted earnings of $0.56 per share missed the Street’s estimates of $0.68 per share and declined from the $0.71 per share posted in the year-ago period. Meanwhile, the 4Q operating revenue of $1.71 billion declined 2% year-over-year but exceeded the consensus estimate of $1.47 billion. (See BEN stock analysis on TipRanks)
On Nov. 23, KBW analyst Robert Lee downgraded the stock to Hold from Buy, citing its valuation. Lee said that on a P/E basis, Franklin Resources is “slightly richer” now relative to the pre-COVID levels. The maintained a price target of $23 (6.6% downside potential).
Meanwhile, the Street has a cautiously bearish outlook on the stock. The Moderate Sell analyst consensus is based on 6 Holds, 4 Sells and 1 Buy. The average price target stands at $21.64 and implies downside potential of about 12.1% to current levels. Shares have dropped by 5.2% year-to-date.
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