Latest news with #AUM
Yahoo
an hour ago
- Business
- Yahoo
Advisors Say $1,000 ‘Trump Accounts' Won't Benefit Families Who Need Help Most
Are your clients planning on having children? Tell them to hurry it up. Inside the Trump administration's key $4 trillion tax bill is a proposed idea to open accounts for each new baby born in the US until 2028. The so-called 'Trump Accounts' are seeded with $1,000 that gets invested in equities and locked up until the child's 18th birthday. Parents can also contribute up to $5,000 annually. Previously called MAGA accounts, the funds are designed to help parents prepare for their children's financial futures. But, what do advisors think about the proposed accounts? 'They are stupid,' said Catherine Valega, an advisor with Green Bee Advisory, adding that the wealthy have plenty of options to save, while the less affluent won't be able to afford additional contributions. READ ALSO: Bitcoin Rules for Now, but the Crypto Landscape Is Vast and RIA Headcount, AUM Shattered Records in 2024 The idea of funding accounts for newly born children is nothing new. In fact, before the current administration, the accounts were called 'Baby Bonds' and have been floated by politicians on both sides of the aisle. Well-known financial advisor Ric Edelman has been a prominent supporter of the idea, and even started a trust product with annuities for babies in 1999. But today, most advisors said the proposed Trump accounts will largely benefit upper-class families who can afford to contribute annually. 'The real advantage will go to families with enough disposable income to consistently fund the account,' said Edzai Chimedza, a CFP and advisor at Tobias Financial, adding that it's an attractive tool for upper-middle-class and affluent families, who are more likely to be able to contribute after covering essentials, like retirement savings and emergency funds. The accounts aren't the only savings options out there, either. Who can forget those 529 plans that have grown significantly more flexible over the years and are a great option to save for college, Valega asked. A guardian Roth IRA can also help children jump-start their retirement savings, while helping them get up to speed with the stock market. Baby Got Tax. For families that can pitch funds into the accounts, it makes sense to stop and think about a client's intentions, said Sarah Avila, an advisor with VLP Financial Advisors. 'If you are eligible to open the account for your baby, it is worth it to get the free $1,000 from the government,' she said. But clients should be aware that earnings on qualified withdrawals will be taxed at long-term capital gains rates. 'If the idea is to save for college, contributing to a 529 plan is more advantageous, from a tax perspective, because the money is tax free,' she said. This post first appeared on The Daily Upside. To receive financial advisor news, market insights, and practice management essentials, subscribe to our free Advisor Upside newsletter.
Yahoo
27-05-2025
- Business
- Yahoo
Franklin Shares Up 6.2% in the Past 3 Months: How to Play the Stock?
Franklin Resources, Inc. BEN has gained 6.2% in the past three months, outperforming the industry's 8.1% decline and the S&P 500 Index's 2.7% dip. In contrast, peers like Grupo Aval Acciones y Valores AVAL lost 1.4%, while Invesco Ltd IVZ plunged 17.3% in the same time frame. Image Source: Zacks Investment ResearchDoes the BEN stock have more upside left despite showing recent strength in share price? Let us try to find out. Strategic Acquisition: Franklin has expanded its investment capabilities through targeted acquisitions, reinforcing its presence in alternative asset classes. The company completed the Putnam Investments acquisition in January 2024, enhancing its defined contribution AUM to over $100 billion. Additionally, Franklin acquired Lexington Partners in 2022, deepening its exposure to private equity and alternative investments. These acquisitions have strengthened Franklin's ability to diversify revenue streams, reducing reliance on traditional investment management fees. Steady AUM Growth: Franklin has demonstrated consistent AUM growth, recording a compound annual growth rate (CAGR) of 3.1% over the past five fiscal years (ending fiscal 2024). While AUM declined in fiscal 2022, the company has since recovered, with growth continuing in the first six months of fiscal 2025. Franklin's efforts to diversify into alternative asset classes are seeing increasing client demand and are expected to propel AUM expansion in the upcoming period. Additionally, its regionally focused distribution model has strengthened its non-U.S. business, contributing to favorable net flows. Also, strategic acquisitions keep supporting AUM's growth. Strong Liquidity: Franklin has a solid balance sheet, with $5 billion in liquidity as of March 31, 2025. This includes cash and cash equivalents, receivables, and investments, ensuring financial flexibility in managing operations. Importantly, the company has no short-term debt, reducing the risk of immediate financial strain. Its earnings strength, combined with a stable liquidity position, reflects a lower likelihood of defaulting on interest or debt repayments, even if market conditions deteriorate. Capital Distribution: Franklin's capital distribution activities have been impressive over the years. In December 2023, the company announced a repurchase authorization of 27.2 million shares of its common stock. As of March 31, 2025, 29.2 million shares remained available for repurchase under its existing authorization. Moreover, it announced a 3.2% hike in its common stock dividend in December 2024. BEN has a current yield of 5.95%, higher than its peers IVZ's 5.74% and AVAL's 3.65%. These capital distribution activities, combined with a decent liquidity profile, will likely stoke investors' confidence in stock. Volatility in Investment Management Fees: Franklin's investment management fees, its largest revenue source (79.3% as of March 31, 2025), have exhibited fluctuations over the years. These fees depend on the level and mix of AUM and the types of services provided. While the company recorded declines in fiscal 2020 and fiscal 2023, investment management fees increased in fiscal 2021 and fiscal 2022. The uptrend continued in fiscal 2024 and the first six months of fiscal 2025. However, changes in AUM that remain exposed to market fluctuations, foreign exchange translations, regulatory shifts, and business slowdowns could negatively impact Franklin's financials in the future. Rising Cost Base: Franklin's escalating cost base remains a concern. The expenses have grown at a CAGR of 7.2% over the last three fiscal years (ending fiscal 2024). The uptrend continued in the first six months of fiscal 2025, driven by investments in technological advancements and new talent acquisitions. These higher expenses are likely to pressure Franklin's bottom-line growth in the upcoming period. Franklin is currently trading at a forward 12-month price-to-earnings (P/E) multiple of 10.14X, significantly below the industry's P/E of 16.42X. Price-to-Earnings F12M Image Source: Zacks Investment Research BEN is trading at a premium compared to its peers, Invesco and Grupo Aval Acciones Y Valores, P/E multiple of 6.68X and 8.22X, respectively. The company's efforts to diversify its business into asset classes that are seeing growing client demand, like alternative asset classes, are expected to propel AUM growth. Also, a solid balance sheet enables sustainable capital distributions. However, volatility in investment management fees due to market fluctuations is concerning as it is a major component of Franklin's total revenues. This might impact the company's revenues in the near term. Sales Estimates Image Source: Zacks Investment Research Also, the company's earnings estimates for 2025 and 2026 have been revised downward over the past week, reflecting a cautious stance from analysts. (See the Zacks Earnings Calendar to stay ahead of market-making news.) Estimate Revision Trend Image Source: Zacks Investment Research Thus, despite favorable valuations, the BEN stock warrants caution at the moment. Those who own the stock can continue holding it for now, as it is likely to generate a healthy return over the long run. BEN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. BEN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. BEN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. BEN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks Resources, Inc. (BEN) has gained 8.4% in the past three months, outperforming the industry's 6.1% decline and the S&P 500 Index's 1.2% dip. In contrast, peers like Grupo Aval Acciones y Valores (AVAL) lost 7.0%, while Invesco Ltd (IVZ) plunged 16.5% in the same timeframe. Price Performance Does the BEN stock have more upside left despite showing recent strength in share price? Let us try to find out. Factors Likely to Drive BEN Stock Higher Strategic Acquisition: Franklin has expanded its investment capabilities through targeted acquisitions, reinforcing its presence in alternative asset classes. The company completed the Putnam Investments acquisition in January 2024, enhancing its defined contribution AUM to over $100 billion. Additionally, Franklin acquired Lexington Partners in 2022, deepening its exposure to private equity and alternative investments. These acquisitions have strengthened Franklin's ability to diversify revenue streams, reducing reliance on traditional investment management fees. Steady AUM Growth: Franklin has demonstrated consistent AUM growth, recording a compound annual growth rate (CAGR) of 3.1% over the past five fiscal years (ending fiscal 2024). While AUM declined in fiscal 2022, the company has since recovered, with growth continuing in the first six months of fiscal 2025. Franklin's efforts to diversify into alternative asset classes are seeing increasing client demand and are expected to propel AUM expansion in the upcoming period. Additionally, its regionally focused distribution model has strengthened its non-U.S. business, contributing to favorable net flows. Strong Liquidity: Franklin has a solid balance sheet, with $5 billion in liquidity as of March 31, 2025. This includes cash and cash equivalents, receivables, and investments, ensuring financial flexibility in managing operations. Importantly, the company has no short-term debt, reducing the risk of immediate financial strain. Its earnings strength, combined with a stable liquidity position, reflects a lower likelihood of defaulting on interest or debt repayments, even if market conditions deteriorate. Also, strategic acquisitions keep supporting AUM's growth. Capital Distribution: Franklin has consistently prioritized shareholder returns, maintaining a quarterly dividend of 32 cents per share. In December 2024, the company raised its dividend by 3.2%, reinforcing its commitment to rewarding investors. Additionally, the company has been actively repurchasing shares, with 0.5 million shares repurchased in the second quarter of 2025. As of March 31, 2025, 29.2 million shares remained available for repurchase under its existing authorization. The company enjoys a decent balance sheet position. As of March 31, 2025, the company had no short-term debt. Its liquidity (comprising cash and cash equivalents, receivables and investments) as of the same date was $5 billion. BEN has a current yield of 5.95%, higher than its peers IVZ's 5.74% and AVAL's 3.65%. These capital distribution activities, combined with a decent liquidity profile, will likely stoke investors' confidence in stock. Near-Term Hurdles for BEN Volatility in Investment Management Fees: Franklin's investment management fees, its largest revenue source (79.3% as of March 31, 2025), have exhibited fluctuations over the years. These fees depend on the level and mix of AUM and the types of services provided. While the company recorded declines in fiscal 2020 and fiscal 2023, investment management fees increased in fiscal 2021 and fiscal 2022. The uptrend continued in fiscal 2024 and the first six months of fiscal 2025. However, changes in AUM that remain exposed to market fluctuations, foreign exchange translations, regulatory shifts, and business slowdowns could negatively impact Franklin's financials in the future. Rising Cost Base: Franklin's escalating cost base remains a concern. The expenses have grown at a CAGR of 7.2% over the last three fiscal years (ending fiscal 2024). The uptrend continued in the first six months of fiscal 2025, driven by investments in technological advancements and new talent acquisitions. These higher expenses are likely to pressure Franklin's bottom-line growth in the upcoming period. Earnings per share estimate for the current quarter has declined from 0.47 to 0.46 over the past seven days, reflecting analyst concerns over earnings pressure. Similarly, the next quarter's estimate has fluctuated, reinforcing uncertainty in Franklin's near-term profitability. BEN Stock Trades at a Discount Franklin is currently trading at a forward 12-month price-to-earnings (P/E) multiple of 10.14X, significantly below the industry's P/E of 16.42X. BEN is trading at a premium compared to its peers, Invesco and Grupo Aval Acciones Y Valores, P/E multiple of 6.68X and 8.22X, respectively. How Should You Play BEN Stock? The company's efforts to diversify its business into asset classes that are seeing growing client demand, like alternative asset classes, are expected to propel AUM growth. Also, a solid balance sheet enables sustainable capital distributions. (See the Zacks Earnings Calendar to stay ahead of market-making news.) However, volatility in investment management fees due to market fluctuations is concerning as it is a major component of Franklin's total revenues. This might impact the company's revenues in the near term. Sales Estimates Also, the company's earnings estimates for 2025 and 2026 have been revised downward over the past week, reflecting a cautious stance from analysts. Estimate Revision Trend Thus, despite favorable valuations, the BEN stock warrants caution at the moment. Those who own the stock can continue holding it for now, as it is likely to generate a healthy return over the long run. BEN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Franklin Resources, Inc. (BEN) : Free Stock Analysis Report Invesco Ltd. (IVZ) : Free Stock Analysis Report Grupo Aval Acciones y Valores S.A. (AVAL) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Time of India
23-05-2025
- Business
- Time of India
Brookfield looks to treble India assets in 5 yrs
MUMBAI: Brookfield Asset Management is aiming to more than triple its assets under management in India to $100 billion over the next five years, a senior official said on Thursday. Connor Teskey, the president of the New York-headquartered global asset manager, said it expects the global AUM to double over the next five years from the present $1 trillion, and the growth in emerging markets like India would be higher. At present, the AUM in India, where the firm has been investing for over 15 years, is $30 billion in assets across sectors like infrastructure, real estate, renewable power and also private equity. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Yahoo
22-05-2025
- Business
- Yahoo
Billionaire Philippe Laffont Has Cumulatively Sold 83% of Coatue's Nvidia Stake and Is Piling Into Wall Street's Hottest Artificial Intelligence (AI) IPO
The quarterly filing of Form 13Fs offers a way for everyday investors to track the buying and selling activity of Wall Street's leading money managers. Philippe Laffont has been a persistent seller of Nvidia stock for the last two years. Coatue's billionaire chief was an aggressive buyer of another artificial intelligence (AI) stock that's expected to 10X its sales by 2028. These 10 stocks could mint the next wave of millionaires › May has been a data-packed month for investors. Between earnings season, a steady flow of economic data releases from the government, and the Federal Open Market Committee's federal funds rate decision, there's been a lot to unpack. But arguably the most important data release of the quarter occurred one week ago, on May 15. This was the deadline for institutional investors with at least $100 million in assets under management (AUM) to file Form 13F with the Securities and Exchange Commission. A 13F provides investors with a way to track which stocks and exchange-traded funds (ETFs) Wall Street's most prominent money managers have been buying and selling. Though Berkshire Hathaway's Warren Buffett is the most followed of all asset managers, he's far from the only billionaire investor known to deliver outsized returns and move markets. For instance, billionaire fund manager Philippe Laffont of Coatue Management, who's overseeing $22.7 billion in AUM, has a rich track record of outperformance. Laffont is also known for his love of high-growth stocks -- especially those in the tech sector. Based on Coatue's first-quarter 13F, its billionaire chief continued to be a seller of the world's leading artificial intelligence (AI) stock, Nvidia (NASDAQ: NVDA), but absolutely piled into Wall Street's hottest AI-initial public offering (IPO) of the year. Taking into account that Nvidia completed a 10-for-1 forward split in June 2024, Coatue's position in Wall Street's AI darling peaked at 49,802,020 shares in the March-ended quarter of 2023. Over the last two years, Laffont has been paring down this position with regularity. During the first quarter of 2025, Laffont's fund dumped 1,460,653 shares of Nvidia stock, which represents a sequential quarterly decline of about 15%. But over the last eight quarters, Coatue's billionaire boss has overseen the sale of 41,256,185 cumulative shares of Nvidia, representing 83% of the fund's original stake. To be objective, Nvidia has done a lot of things right to get to where it is now. Its Hopper (H100) graphics processing unit (GPU) and successor Blackwell GPU architecture have run circles around the competition, in terms of compute ability. Nvidia's hardware maintains a near-monopoly-like share in enterprise AI data centers. Overwhelming demand for Nvidia's GPUs also boosted its pricing power. With the Hopper and Blackwell commanding a premium over all other GPUs, it's no surprise that Nvidia's gross margin surpassed 70%. But not everything is perfect for Nvidia -- and Laffont's trading activity suggests it. Despite Nvidia having superior hardware, competitive pressures are beginning to weigh on its margins. In addition to direct external competitors ramping up production of their AI-GPUs, many of Nvidia's top customers by net sales are internally developing chips they'll use in their own data centers. The cost and accessibility advantage of relying on internally produced AI solutions could realistically result in Nvidia losing out on valuable future data center real estate. The presence of new external and internal competition is also working to minimize the effect of AI-GPU scarcity. This has been Nvidia's primary competitive edge for two years, and it's the core reason its gross margin surged to as high as 78.4% one year ago. With its gross margin expected to decline, yet again, in the fiscal first quarter, it's clear that Nvidia's biggest advantage is withering. The other big-time concern for Nvidia shareholders is the likelihood of an AI bubble forming and bursting. Including the proliferation of the internet in the mid-1990s, there hasn't been a game-changing innovation in more than three decades that's avoided a bubble-bursting event early in its expansion. The fact that most businesses haven't optimized their AI solutions, and in many instances aren't generating a positive return on their AI investments, strongly signals that investors have (again) overestimated the early innings utility and adoption rate of a next-big-thing trend. With more than 90% of Nvidia's net sales coming from its data center segment in the fiscal fourth quarter of 2025 (ended Jan. 26, 2025), a bursting of the AI bubble would be disastrous for its stock. Although Laffont was a seller of a lot of high-growth tech stocks during the March-ended quarter, there was one artificial intelligence company that caught his attention in a big way -- and it only debuted as a public company days before the end of the first quarter! Arguably no stock was purchased more aggressively in the opening frame of 2025 by Coatue's billionaire chief than Nvidia-backed AI-data center infrastructure company CoreWeave (NASDAQ: CRWV). In its two business days as a publicly traded company in the first quarter (the company's IPO was Friday, March 28), Laffont scooped up 14,402,999 shares, which vaulted it to Coatue's 16th-largest holding by market value. The allure of CoreWeave for Laffont almost certainly has to do with the insatiable enterprise demand for AI computing resources. CoreWeave has purchased 250,000 Hopper chips from Nvidia, which is no small investment. In return, the company can lease out its AI infrastructure and services to clients, with the amount it generates in sales all dependent on things like demand, the services rendered, and the GPUs needed to complete a task. Coatue's billionaire money manager is likely also impressed with CoreWeave's expected growth ramp. Keeping in mind that consensus growth estimates for relatively early stage businesses are often fluid, CoreWeave's sales are projected to catapult from a reported $1.92 billion in 2024 to an estimated $19.66 billion come 2028. The company also announced a strategic deal with OpenAI that tacks on $11.2 billion in its revenue backlog. The numbers on paper absolutely paint an exciting picture for CoreWeave. But the real world doesn't always pan out as things do on paper. To begin with, CoreWeave's net losses are accelerating at the same staggering rate as its sales. As an early stage business, the company had to rely on debt financing to fund its GPU purchases. Last year, CoreWeave had nearly $361 million in net interest expenses. Its annual run in 2025 for net interest expense, based on its recently reported first quarter, is almost $1.06 billion! Investors should expect steep losses as CoreWeave's revenue ramp-up continues. Another sizable concern for CoreWeave, which might actually trump its rapidly widening net loss, is Nvidia's accelerated innovation cycle. Nvidia plans to bring a new high-powered AI chip to market roughly once per year. This means that CoreWeave's predominantly Hopper GPU-powered data centers could quickly become obsolete -- or at the very least, it could substantially weaken the company's pricing power for its services. Lastly, CoreWeave would almost certainly be adversely affected by an AI bubble forming and bursting. Until artificial intelligence matures as a technology, the threat of businesses paring back their AI infrastructure spending remains a tangible concern. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $351,127!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $40,106!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $642,582!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join , and there may not be another chance like this anytime soon.*Stock Advisor returns as of May 19, 2025 Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway and Nvidia. The Motley Fool has a disclosure policy. Billionaire Philippe Laffont Has Cumulatively Sold 83% of Coatue's Nvidia Stake and Is Piling Into Wall Street's Hottest Artificial Intelligence (AI) IPO was originally published by The Motley Fool Sign in to access your portfolio
Entrepreneur
21-05-2025
- Business
- Entrepreneur
UGRO Capital Approves INR 915 Crore Capital Raise via Compulsorily Convertible Debentures
The new CCDs will be issued at a conversion price of INR 185 per share, significantly lower than the INR 264 conversion price set during UGRO's previous capital raise in June 2024, when the company secured INR 258 crore via CCDs and INR 1,007 crore through warrants. You're reading Entrepreneur India, an international franchise of Entrepreneur Media. UGRO Capital, a DataTech-driven NBFC focused on MSME financing, has announced a preferential issue of Compulsorily Convertible Debentures (CCDs) amounting to INR 915 crore, following approval by its Board of Directors. The move is aimed at accelerating the company's growth trajectory and expanding its lending capabilities in the underserved MSME segment. The announcement was made via a press release. The new CCDs will be issued at a conversion price of INR 185 per share, significantly lower than the INR 264 conversion price set during UGRO's previous capital raise in June 2024, when the company secured INR 258 crore via CCDs and INR 1,007 crore through warrants. The latest infusion is expected to lift UGRO Capital's capital adequacy ratio from 19.41 per cent at the close of FY25 to 29.4 per cent, providing a substantial buffer to support its expansion plans. The company's assets under management (AUM) doubled from INR 6,081 crore in FY23 to INR 12,003 crore in FY25. During the same period, profit before tax surged from INR 84 crore to INR 203 crore, while return on assets (ROA) improved from 1.3 per cent to 2.9 per cent (excluding Emerging Market branch expansion impact). Shachindra Nath, managing director of UGRO Capital, said, "UGRO has delivered strong operating performance. I am thankful for all of the existing shareholders and warrant holders for committing a significant amount of capital to UGRO which would ensure that UGRO continues on its growth journey." The preferential allotment has drawn major commitments from institutional investors. Samena Capital and its private equity funds, which already hold a 7.49 per cent stake in UGRO, have committed up to INR 500 crore, positioning them as a leading institutional shareholder. Singapore-based public market investor Aregence has committed INR 168 crore, while several prominent family offices have also participated. To ensure equitable participation for retail investors, UGRO's board has also approved a rights issue of up to INR 400 crore. The terms will be finalized in an upcoming board meeting. IFU, the Danish Government's impact fund and an existing investor with a 16.35 per cent stake, has pledged INR 150 crore toward the rights Issue. Promoters and employees have jointly committed INR 34 crore via both CCDs and the rights Issue.
