Stock Analysis

This Insider Has Just Sold Shares In Franklin Resources, Inc. (NYSE:BEN)

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NYSE:BEN
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We'd be surprised if Franklin Resources, Inc. (NYSE:BEN) shareholders haven't noticed that the Executive Vice President of Technology & Operations, Alok Sethi, recently sold US$276k worth of stock at US$27.64 per share. That sale was 18% of their holding, so it does make us raise an eyebrow.

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The Last 12 Months Of Insider Transactions At Franklin Resources

In fact, the recent sale by Alok Sethi was the biggest sale of Franklin Resources shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was slightly below the current price of US$27.68, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 18% of Alok Sethi's stake.

The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NYSE:BEN Insider Trading Volume February 18th 2021

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Insider Ownership of Franklin Resources

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Franklin Resources insiders own about US$6.2b worth of shares (which is 44% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Franklin Resources Tell Us?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Franklin Resources. At Simply Wall St, we found 5 warning signs for Franklin Resources that deserve your attention before buying any shares.

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For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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What are the risks and opportunities for Franklin Resources?

Franklin Resources, Inc. is a publicly owned asset management holding company.

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Rewards

  • Trading at 12.6% below our estimate of its fair value

Risks

No risks detected for BEN from our risks checks.

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Share Price

Market Cap

1Y Return

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Further research on
Franklin Resources

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