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Strategies & Market Trends : Value Investing

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To: hoyasaxa who wrote (32049)	9/18/2008 2:04:26 PM
From: Paul Senior	Read Replies (1) of 78673

Starting for a decent position in asset manager, BEN. Barron's 9/10 article not too positive: "Relative returns are likely to remain weak across Templeton's largest equity funds given adverse forex trends and ongoing global equity-market volatility. As flows tend to follow performance, we expect aggregate net flows to remain decidedly negative in the near term...Our reduced earnings outlook reflects lower August AUM; more conservative net flow assumptions; less favorable revenue yields; and tighter margins. As a result of our weaker earnings projections, we are taking down our price target from $120 to $103." Sandler O'Neill & Partners Zacks says "hold": predicts small earnings drops: $7.03 ('07) to $6.95 to $6.74 ('09). Imo, from my recollection/experience, publicly-traded asset managers take a hit when stock markets decline, and come back when the markets improve. I'm intending to buy now and wait for the better times. I've landed on BEN; others might be better - I've not looked - BEN seems okay to me: It has the size/diversity/reputation. Fabulous profit margins and relatively (to itself) low p/sales. Okay roe (20% 5-yr avg). Book value increasing every year. P/bk = 2.9 has been higher and lower in past years. D/e almost 0. Stock price --- oops, has moved up as I've written -- around $90. 20 bucks/sh in cash. Small dividend, sometimes increased. Relatively low p/e now (12). It's a buy! (Bwdik. Jmo, and I've been wrong many,many times.) finance.yahoo.com

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