Franklin's AUM Expansion: Can Diversification Support Growth Momentum?

Driven by strong inflows across asset classes and continued expansion into alternatives and private markets, Franklin Resources, Inc. BEN has been witnessing steady growth in its assets under management (AUM). Over the last five fiscal years (2021-2025), AUM recorded a compound annual growth rate (CAGR) of 3.1%, despite declines in fiscal 2022 and 2025. The growth trend continued in the first nine months of fiscal 2026, with AUM reaching a record $1.79 trillion as of June 30, 2026, up 11.2% year over year.

AUM Growth Trend

Image Source: Franklin Resources, Inc.

A key strength for Franklin is its diversified AUM mix across traditional and alternative asset classes. The company’s alternative AUM reached a record $294.2 billion in the third quarter of fiscal 2026, driven by strong fundraising momentum in private markets and greater exposure to higher-growth asset classes. The acquisition of Apera Asset Management further strengthened its alternative credit capabilities, lifting alternative credit AUM above $90 billion and total alternatives AUM to about $270 billion in 2025.

Beyond alternatives and private markets, digital assets have emerged as a new growth area for Franklin, with AUM reaching $3.2 billion in the third quarter of fiscal 2026. In June 2026, the acquisition of 250 Digital and the launch of Franklin Crypto expanded its institutional trading, separately managed account and tokenization capabilities. Further, partnerships with MoonPay in June 2026 and Payward in May 2026 broadened access to tokenized money market funds and institutional digital-asset services. These initiatives are expected to provide additional avenues for AUM growth while further diversifying the company’s asset base.

The upward trend in AUM continued in July, with Franklin reporting preliminary AUM of $1.80 trillion as of July 31, 2026, up from $1.79 trillion at the end of June. The increase was driven by $6 billion in long-term net inflows and favorable market conditions. Continued AUM growth reflects sustained client demand and momentum across Franklin’s diversified investment platforms.

Private credit concerns may moderately slow Franklin’s near-term AUM growth amid investor concerns around liquidity, valuations and credit quality. Nevertheless, the company’s diversified asset mix, strong private markets fundraising, strategic acquisitions and expanding digital-asset capabilities are expected to drive further AUM growth.

AUM Performance of Franklin’s Peers

T. Rowe Price Group, Inc. TROW has witnessed steady AUM growth, supported by its diversified asset mix. AUM recorded a 6.5% CAGR during 2020-2025, with the growth trend continuing in the first half of 2026.

TROW’s growth was driven by market appreciation and strength in multi-asset and fixed-income products, despite continued equity outflows.

Similarly, Lazard, Inc. LAZ has witnessed steady AUM growth, with a 2.8% CAGR during 2016-2025. Growth continued in the first half of 2026, supported by positive net flows that marked its best first-half inflow performance in nearly 20 years.

LAZ also expanded its private market capabilities through strategic acquisitions, with its Elaia Partners stake adding $1 billion to AUM in the second quarter of 2026.

BEN Price Performance & Zacks Rank

The company’s shares have gained 23.8% in the past six months compared with the industry’s 3.6% rise.

Price Performance

Image Source: Zacks Investment Research

Currently, the company carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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