Bendigo Bank
BEN
$32.21
-4.90%
Franklin Templeton, Inc. is a global asset manager providing investment advisory, management, administrative, distribution, and shareholder services to individual and institutional investors across equity, fixed income, multi-asset, alternatives, and money market strategies, with roughly $1.827 trillion in assets under management as of August 2026. It is one of the most globally diversified of the large US-based asset managers, with approximately 30% of AUM in global/international strategies and 29% sourced from non-US clients, and it derives the bulk of revenue from investment advisory and management fees ($1.866 billion of the latest quarterly total) supplemented by sales/distribution and shareholder servicing fees. The current investor debate centers on whether the firm can convert market-driven AUM appreciation and cost discipline into durable organic growth, given a 14.3% year-over-year revenue increase in the June 2026 quarter but lumpy earnings, a payout ratio above 100% of earnings, and a stock that has rallied sharply over the past year while sell-side sentiment remains cautious. Recent news flow has been routine in nature, such as the February 2026 announcement of Canadian ETF cash distributions, underscoring a steady income-oriented franchise rather than a catalyst-rich growth story.…
BEN
Bendigo Bank
$32.21
Related headlines
Investment Opinion: Should I buy BEN Today?
Rating: Hold. Franklin Templeton offers a 5.75% dividend yield, 10.24x forward earnings on $4.15 consensus EPS, and 0.99x book value, but a 130.3% payout ratio, TTM free cash flow of just $223.3 million, and a 'hold' consensus (mean 2.62; 4 Buy/7 Hold/2 Sell) with a $35.46 average target (+9.6%) argue against chasing the stock after its 41.68% one-year run. The core thesis is that BEN is a cheap, income-generating asset manager whose earnings normalization is plausible but unproven, so investors are paid to wait rather than to buy aggressively at $32.36.
Supporting evidence: revenue grew 14.26% YoY to $2.358 billion in the June 2026 quarter, yet net income fell to $171.5 million (7.27% net margin) from $346.6 million (15.10%) in Q2, and operating margin is only 6.89% (9.15% in the quarter) against a 15.30x EV/EBITDA and 3.60 PEG. The valuation cushion is real — 1.36x sales, 0.99x book, and a 25.42x trailing PE that collapses to 10.24x forward — but the 130.3% payout ratio against $223.3 million TTM FCF and lumpy quarterly FCF ($561.7 million in Q3, -$31.4 million in Q2, -$255.1 million in Q1) means the dividend depends on balance-sheet capacity ($3.76 billion cash, 2.71 current ratio) rather than earnings. Analyst upside of +9.6% to the $35.46 average is modest and sits below the $36.28 52-week high, confirming limited re-rating room without an earnings surprise.
The biggest risks are a dividend that is not covered by earnings, earnings volatility driven by a 53.8% effective tax rate and revenue concentration in $1.866 billion of advisory fees, and a 1.602 beta that amplifies drawdowns (max drawdown -19.21%; 52-week low $21.11, -34.8% from $32.36). The rating would upgrade to Buy on forward PE below 9x, a payout ratio falling under 100%, or two consecutive quarters of net margin above 12%; it would downgrade to Sell on a dividend cut, TTM FCF turning negative, or a break below the $30.50 support that opens the mid-$20s. Verdict: fairly valued to modestly undervalued on forward earnings and book, but not cheap enough to offset income-statement quality concerns — a Hold for income-oriented investors, not a Buy.
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BEN 12-Month Price Forecast
BEN presents a value-and-income profile with a genuine valuation cushion — 0.99x book, 1.36x sales, and 10.24x forward earnings — but the earnings quality behind that multiple is questionable, with net margin collapsing to 7.27% in Q3 2026 and free cash flow of just $223.3 million against a 130.3% payout ratio. The 41.68% one-year rally has already captured much of the re-rating, and the sell-side has not validated it: the consensus remains 'hold' with no recent upgrades and a $35.46 target only 9.6% above the $32.36 price. The 1.602 beta and -19.21% max drawdown mean the downside is amplified if AUM-linked fees fall or the dividend comes under pressure. I would upgrade to bullish on two consecutive quarters of net margin above 12% with payout ratio below 100%, or a decisive break above $36.28; I would downgrade to bearish on a dividend cut or a close below the $30.50 support.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Bendigo Bank's 12-month outlook, with a consensus price target around $35.46 and implied upside of +10.1% versus the current price.
Average Target
$35.46
13 analysts
Implied Upside
+10.1%
vs. current price
Analyst Count
13
covering this stock
Price Range
$26 - $40
Analyst target range
Coverage is moderate, with 13 analysts and a consensus recommendation of "hold" (mean rating 2.62 on a 1-5 scale). The distribution is 4 Buy, 7 Hold, and 2 Sell — a neutral-to-cautious tilt. The average target price of $35.46 implies roughly +9.6% upside from the current $32.36, a modest but positive signal that nonetheless lags the stock's 41.68% one-year gain, suggesting analysts see limited further re-rating from here.
The target range of $26.00 to $40.00 is wide relative to the $32.36 price, spanning roughly -20% to +24%, which signals meaningful disagreement about the earnings trajectory. The $40 high target likely assumes successful cost discipline, AUM growth, and multiple expansion toward the forward PE implied by $4.15 consensus EPS, while the $26 low target prices in margin compression, fee pressure, and weaker markets. Institutional ratings show a stable but unenthusiastic pattern — Barclays, JP Morgan, and Morgan Stanley have reiterated Equal Weight/Neutral, Evercore ISI has repeatedly maintained Underperform, and TD Cowen is the notable Buy — with no recent upgrades, indicating conviction remains low and the stock's recent strength has not been validated by sell-side sentiment.
Bulls vs Bears: BEN Investment Factors
The bull case for BEN rests on its attractive forward valuation (10.24x forward PE, 0.99x book), strong revenue growth of 14.26% YoY, and a high dividend yield of 5.75% that offers income appeal. However, the bear case is equally compelling: earnings are volatile with margins under pressure, the dividend payout ratio exceeds 100% of earnings, free cash flow is lumpy and weak, and analyst sentiment remains cautious with a 'hold' consensus and no recent upgrades. The most critical tension is whether BEN can convert market-driven AUM appreciation into sustainable organic growth and margin expansion—if it can, the stock's discounted valuation could re-rate significantly; if not, the current rally may be overextended. On balance, the bear evidence appears slightly stronger given the earnings quality concerns and cautious sell-side stance, but the valuation cushion and income support keep the debate balanced.
Bullish
- Revenue growth accelerating: Revenue grew 14.26% YoY to $2.358 billion in the June 2026 quarter, up from $2.064 billion a year earlier, marking a meaningful acceleration from the prior-year period. The trailing four-quarter total of ~$9.28 billion versus $8.84 billion prior-year reflects steady expansion, supporting the view that AUM appreciation and mix are translating into top-line gains.
- Attractive forward valuation: At $32.36, BEN trades at just 10.24x forward earnings (consensus EPS of $4.15) and 0.99x book value, a steep discount to its own historical PE range of 9.4x–39.8x and a fraction of the 25.42x trailing multiple. The 1.36x price-to-sales ratio is also well below the 5–7x levels seen in 2021–2022, suggesting the market is pricing in significant skepticism that may prove overdone if earnings normalize.
- High dividend yield with coverage capacity: BEN offers a 5.75% dividend yield, far above the S&P 500 average, backed by $3.76 billion of cash and a current ratio of 2.71. While the payout ratio of 130.3% of earnings raises questions, the company's strong liquidity position and $298.6 million of quarterly EBITDA provide capacity to sustain the dividend while earnings recover toward consensus.
- Analyst target implies upside: The average analyst target price of $35.46 represents roughly 9.6% upside from the current $32.36, with a high target of $40.00 implying 23.6% upside. Although the consensus rating is 'hold,' the positive spread between target and price suggests that even cautious analysts see limited downside and potential for re-rating if operational improvements materialize.
Bearish
- Earnings volatility and margin pressure: Net income fell sharply to $171.5 million in Q3 2026 from $346.6 million in Q2, with the net margin compressing to 7.27% from 15.10%. The effective tax rate spiked to 53.8% in the quarter, and operating margin of 9.15% remains thin for an asset manager, highlighting earnings sensitivity to revenue mix and one-time items.
- Unsustainable payout ratio: The dividend payout ratio stands at 130.3% of earnings, meaning the company is paying out more than it earns. With TTM free cash flow of only $223.3 million against a market cap of $11.9 billion, the dividend is being funded partly from balance-sheet capacity rather than organic cash generation, posing a risk if earnings do not recover as expected.
- Cautious analyst sentiment: The consensus recommendation is 'hold' with a mean rating of 2.62 (on a 1–5 scale), comprising 4 Buy, 7 Hold, and 2 Sell ratings. Notably, Evercore ISI has repeatedly maintained an Underperform rating, and there have been no recent upgrades, indicating low conviction and skepticism about the sustainability of the recent rally.
- Lumpy and weak free cash flow: Free cash flow has been highly volatile, swinging from $561.7 million in Q3 2026 to -$31.4 million in Q2 and -$255.1 million in Q1, resulting in TTM FCF of just $223.3 million. This inconsistency raises concerns about the company's ability to generate steady cash flow to support dividends and reinvestment.
BEN Technical Analysis
BEN is in a sustained, powerful uptrend that has recently transitioned into a high-level consolidation. The stock is up 41.68% over the past year and 35.97% year-to-date, massively outperforming the S&P 500's 10.39% and 10.62% respective gains, with relative strength of +31.29 percentage points over 12 months. At $32.36, the shares sit roughly 78% of the way through the 52-week range of $21.11 to $36.28, meaning they retain clear momentum but are no longer pressing the highs, having pulled back from the August peak near $35.77 and the 52-week high of $36.28.
Short-term momentum has decelerated and diverged from the longer-term trend. The stock is down 1.37% over the past month and 7.33% over three months, even as it remains up 6.03% over six months and 41.68% over a year, and its 3-month relative strength versus SPY is -5.32 points. This pattern — strong 12-month gains but negative 1- and 3-month returns — is characteristic of a maturing advance undergoing mean reversion rather than a trend reversal, particularly since the 1-month decline (-1.37%) was milder than SPY's (-1.99%), yielding a modestly positive 1-month relative strength of +0.62. The recent bounce from the mid-October low near $30.53 back to $32.36, including a 1.22% single-day gain on the latest session, suggests buyers are defending the low-$30s.
Key technical levels are well defined: support sits at the October swing low around $30.50 and, more decisively, the 52-week low of $21.11, while resistance is the 52-week high of $36.28 and the August intraday peak near $35.77. A breakout above $36.28 would confirm resumption of the primary uptrend and likely invite momentum buying, whereas a breakdown below $30.50 would signal a deeper corrective phase toward the mid-$20s. With a beta of 1.602, BEN is roughly 60% more volatile than the market, and its 19.21% maximum drawdown over the period illustrates that position sizing and stop discipline matter materially for holders of this name.
Beta
1.60
1.60x market volatility
Max Drawdown
-19.2%
Largest decline past year
52-Week Range
$21-$36
Price range past year
Annual Return
+41.5%
Cumulative gain past year
| Period | BEN Return | S&P 500 |
|---|---|---|
| 1m | -0.7% | -5.9% |
| 3m | -4.6% | -5.2% |
| 6m | +3.7% | -0.6% |
| 1y | +41.5% | +8.2% |
| ytd | +35.3% | +7.5% |
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BEN Fundamental Analysis
Revenue is growing at a healthy clip. The June 2026 quarter delivered $2.358 billion in revenue, up 14.26% year over year from $2.064 billion, and the trailing four quarters total roughly $9.28 billion versus $8.84 billion in the prior-year period. Sequentially, revenue has been remarkably stable — $2.327 billion in Q1, $2.295 billion in Q2, and $2.358 billion in Q3 — indicating growth is being driven by market appreciation and mix rather than a sharp sequential acceleration. Investment advisory and management fees of $1.866 billion dominate the top line, with sales and distribution fees of $404.5 million and shareholder servicing of $74.3 million providing smaller, more cyclical contributions; the growth trend supports the investment case but remains beta-dependent on asset markets.
Profitability is positive but volatile. The latest quarter produced $171.5 million of net income (a 7.27% net margin) and $298.6 million of EBITDA (12.66% EBITDA margin), a sharp step down from Q2's $346.6 million of net income and 15.10% net margin, and Q1's $255.5 million and 10.98% margin. Gross margin reported at 54.18% for the June quarter versus 52.83% in Q2 and 81.59% in Q1 reflects inconsistent cost-of-revenue classification rather than true margin collapse, while the operating margin of 9.15% and the elevated 53.8% effective tax rate in the quarter weighed on the bottom line. The trend is one of a profitable but operationally leveraged franchise whose earnings swing meaningfully with revenue mix and one-time items.
Balance-sheet and cash-flow quality are adequate but not pristine. Debt-to-equity stands at 1.10, the current ratio is a strong 2.71, and cash on the balance sheet was $3.76 billion at quarter-end, providing ample near-term liquidity. However, free cash flow is lumpy — $561.7 million in the June quarter, -$31.4 million in the March quarter, and -$255.1 million in the December quarter, with TTM FCF of just $223.3 million — and ROE of 4.35% and ROA of 2.64% are low for the sector. The 130.3% payout ratio versus earnings signals the dividend is being funded partly from balance-sheet capacity rather than pure earnings, a key risk to monitor even with the 5.75% yield.
Quarterly Revenue
$2.4B
2026-06
Revenue YoY Growth
+14.3%
YoY Comparison
Gross Margin
54.2%
Latest Quarter
Free Cash Flow
$223300000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is BEN Overvalued?
Because net income is positive, the PE ratio is the primary metric. BEN trades at 25.42x trailing earnings but only 10.24x forward earnings, an unusually wide gap that implies the market expects a substantial earnings recovery — consistent with consensus EPS of $4.15 versus the trailing $0.044 figure (which appears distorted by non-recurring items). The 1.36x price-to-sales and 0.99x price-to-book ratios suggest the stock is not expensive on asset or revenue bases, while the 15.30x EV/EBITDA and 11.16x price-to-cash-flow multiples sit in a moderate range for an asset manager.
Against the asset management industry, the picture is mixed. A 0.99x price-to-book is at or below book value, a discount to the premium multiples typically awarded to scaled alternatives-heavy managers, while the 1.36x PS ratio and 5.75% dividend yield are characteristic of a value-oriented, income-focused manager rather than a growth franchise. The 3.60 PEG ratio and 10.24x forward PE imply the market is pricing modest long-term growth; the premium embedded in the trailing 25.42x PE is largely an artifact of depressed trailing earnings rather than genuine multiple expansion.
Historically, BEN's valuation has compressed dramatically. Its PE ratio ranged from roughly 9.4x to 39.8x over the past several years, and its price-to-book has fallen from about 1.42x in late 2021 to 0.99x today, near the low end of its own band. The current 1.36x PS ratio is also well below the 5-7x levels seen in 2021-2022, though those historical figures appear to use a different share-count basis and should be treated cautiously. Net, the stock is priced for skepticism — a potential value opportunity if earnings normalize toward the $4.15 consensus, but vulnerable if organic growth and margins disappoint.
PE
25.4x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 6x~30x
vs. Industry Avg
16.6x
Industry PE ~16.6x*
EV/EBITDA
15.3x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are significant. The company's dividend payout ratio of 130.3% of earnings means the dividend is not fully covered by net income, and with TTM free cash flow of only $223.3 million, the $0.31 quarterly dividend (implied by the 5.75% yield) may require balance-sheet support. Earnings volatility is pronounced: net income swung from $346.6 million in Q2 2026 to $171.5 million in Q3, with net margin dropping from 15.10% to 7.27%, partly due to a 53.8% effective tax rate and operating margin of just 9.15%. Additionally, revenue is heavily concentrated in investment advisory fees ($1.866 billion of $2.358 billion total), making results highly sensitive to market levels and asset mix. The debt-to-equity ratio of 1.10 is moderate but not insignificant, and the current ratio of 2.71 provides liquidity, yet the low ROE of 4.35% and ROA of 2.64% indicate inefficient capital deployment. Operational risks include the challenge of organic growth in a competitive asset management industry, where fee pressure and passive investing trends could erode margins.
Market and competitive risks are elevated. BEN trades at a forward PE of 10.24x, which is low relative to the broader market but may reflect structural challenges rather than a temporary discount. The stock's beta of 1.602 means it is about 60% more volatile than the market, exposing investors to amplified drawdowns during market corrections. The asset management sector faces headwinds from fee compression, the shift to passive strategies, and regulatory scrutiny, and BEN's global exposure (30% of AUM in international strategies, 29% from non-US clients) adds currency and geopolitical risks. Recent news has been routine, such as ETF cash distributions, with no major catalysts, and the lack of analyst upgrades (consensus 'hold' with 7 holds and 2 sells) suggests limited near-term positive momentum. The stock's 3-month relative strength versus SPY is -5.32 points, indicating underperformance recently, and a sector rotation away from financials could further pressure the shares.
In a worst-case scenario, a combination of market declines reducing AUM, continued margin compression, and a dividend cut could trigger a sharp sell-off. The 52-week low is $21.11, which represents a 34.8% decline from the current $32.36, and the analyst low target of $26.00 implies a 19.6% downside. If earnings fail to recover toward the $4.15 consensus and the payout ratio remains above 100%, the stock could re-test its lows, especially given its high beta. Historical max drawdown of -19.21% over the period suggests that a 20-35% loss is plausible in an adverse scenario. Investors should be prepared for significant volatility and potential capital impairment if the bear case unfolds.
FAQ
The most severe risk is dividend sustainability: the payout ratio is 130.3% of earnings and TTM free cash flow is only $223.3 million, so the 5.75% yield depends partly on balance-sheet capacity ($3.76 billion cash, 2.71 current ratio) rather than earnings. Second is earnings volatility — net income fell from $346.6 million in Q2 2026 to $171.5 million in Q3 as net margin compressed from 15.10% to 7.27%, driven partly by a 53.8% effective tax rate. Third is market sensitivity: revenue is concentrated in $1.866 billion of advisory fees tied to the $1.827 trillion AUM base, and a 1.602 beta amplifies drawdowns (max drawdown -19.21%). Fourth is competitive and structural pressure from fee compression and the shift to passive strategies, which limits organic growth and multiple expansion. Ranked by severity: dividend coverage first, earnings volatility second, market/AUM sensitivity third.
The base case (50% probability) targets $33.00-$35.46, assuming revenue holds near the $8.99 billion consensus, forward PE stays around 10.24x, and the dividend is maintained — delivering modest appreciation plus the 5.75% yield. The bull case (25%) targets $36.28-$40.00, requiring EPS to approach the $4.15 consensus as one-time tax items fade, net margin recovering toward 15%, and a multiple re-rating to 12-13x forward earnings. The bear case (25%) targets $26.00-$30.50, driven by a dividend cut, persistent margin compression, or an AUM-reducing market decline, with the high beta amplifying losses toward the $21.11 52-week low in a severe scenario. The base case is most likely because it requires only that current trends hold — but the key assumption, that the dividend survives a payout ratio above 100%, is the one most worth monitoring.
BEN screens as fairly valued to modestly undervalued on forward metrics. The 25.42x trailing PE looks expensive but is distorted by depressed trailing EPS of $0.044; on the $4.15 consensus EPS the forward PE is just 10.24x, and the stock trades at 0.99x book and 1.36x sales. Those multiples sit near the low end of BEN's own historical range — price-to-book has fallen from roughly 1.42x in late 2021 to 0.99x today — and the 5.75% yield is characteristic of a value-oriented manager rather than a growth franchise. The market is effectively pricing skepticism about earnings quality: the wide gap between trailing and forward PE implies investors expect a large earnings recovery that has not yet been demonstrated. If margins normalize, the discount closes; if they do not, the cheap multiple is deserved.
The risk/reward is balanced rather than compelling. On the positive side, BEN trades at 10.24x forward earnings and 0.99x book value while yielding 5.75%, and the $35.46 average analyst target implies about +9.6% upside from $32.36. On the negative side, the 130.3% payout ratio is not covered by earnings, TTM free cash flow is only $223.3 million, and the consensus rating is 'hold' (4 Buy / 7 Hold / 2 Sell) with no recent upgrades. The biggest downside risk is a dividend cut or a break below $30.50 support, which could take shares toward the $26.00 analyst low — roughly -20%. It is a reasonable buy for income-focused investors with a long horizon who can tolerate a 1.602 beta and want a 5.75% yield, but growth-oriented investors should wait for evidence of margin recovery before adding.
BEN is better suited to long-term, income-oriented holding than short-term trading. The 5.75% dividend yield is the primary return driver, and dividend capture requires patience while earnings normalize; the stock's 1.602 beta and -19.21% max drawdown make short-term positioning risky without tight stops. Momentum has already decelerated — the stock is down 7.33% over three months and 1.37% over one month despite a 41.68% one-year gain — suggesting the easy re-rating is done. Earnings visibility is limited by lumpy quarterly results (EPS ranged from $0.31 to $0.52 across the last three quarters) and a 53.8% effective tax rate that obscures underlying profitability. A minimum holding period of 12-18 months is appropriate, giving time for at least four to six quarters of margin data and a clearer read on dividend coverage.