William Blair & Co. Raises Estimates on Franklin Resources (BEN)

William Blair & Co. is out with a research report this morning, where it reiterates its Outperform rating on shares of Franklin Resources Inc. BEN; it also raised earnings estimates for the company. The WBC analysts said, “As of June 30, 2010, total assets under management were $570.5 billion, compared with our $562.8 billion estimate, driven by better net flows and investment performance relative to our estimate. We increased our third-quarter net flow estimate to $11 billion from $6 billion, with more than 100% of net inflows driven by long-term bond funds.” They added, “We are increasing fiscal third quarter 2010 EPS estimate to $1.47 from $1.44, 2010 to $6.17 from $6.10, and 2011 to $7.10 from $6.95, given better AUM growth in June relative to our estimate.” The WBC analysts further said, “ We expect continued market weakness in June to have an ongoing negative impact on equity flows in the near term. However, with money market fund yields remaining near zero and retail investors psychologically damaged again by the pullback in markets, long-term bond funds could continue to be a beneficiary of flows in the near term, in our opinion. We maintain our Outperform rating, and view the stock as very attractive at just 12.5 times our 2011 calendar-year EPS estimate of $7.35.”