#$ben

5 Trade ideas excerpted from the detailed analysis and plan for premium subscribers:

ACADIA Pharma, Ticker: $ACAD

ACADIA Pharma, $ACAD, started higher in December and met resistance into April. It pulled back slightly and has consolidated there since. Friday saw it try to push over resistance with the RI rising to the bullish zone and the MACD positive and moving higher. Look for a push over resistance to participate…..

Franklin Resources, Ticker: $BEN

Franklin Resources, $BEN, finally broke out of a broad consolidation when it made a higher high in April. The pullback from there found support at the 200 day SMA and it reversed back higher. It is now approaching the April high with the RSI rising in the bullish zone and then MACD positive and moving higher. Look for a push over the April high to participate…..

Graphic Packaging, Ticker: $GPK

Graphic Packaging, $GPK, cleared a double bottom in February and then shifted to a sideways consolidation. In April it broke that to the upside and gapped up to find resistance in May. After a pullback to the 200 day SMA it reversed and ran to a higher high into June. Another pullback, to a higher low, and it reversed again. It sits at the prior high with the RSI rising in the bullish zone and the MACD crossed up and rising. Look for a new high to participate…..

Atlassian, Ticker: $TEAM

Atlassian, $TEAM, has been moving higher since October. There have been a couple of pauses and pullbacks along the way and it is consolidating in one now. The RSI is rising in the bullish zone with the MACD crossing up and positive. Look for a push up out of consolidation to participate…..

Western Union, Ticker: $WU

Western Union, $WU, started higher in December and paused as it moved into February. The price held over the 50 day SMA on a pullback and then started higher in March. It flattened out again in April and continued sideways until the beginning of June. It rose and found resistance again then pulled back to the 50 day SMA. A reversal sees it back at the prior high with the RSI rising in the bullish zone and the MACD crossed up and rising. Look for a push over resistance to participate…..

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After reviewing over 1,000 charts, I have found some good setups for the week.  These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which heading into the heat of summer and earnings season, sees the equity markets are a bit mixed but all strong on the shorter timeframe.

Elsewhere look for Gold to pause in its uptrend, holding around 1400, while Crude Oil pauses in the pullback. The US Dollar Index looks to reverse higher in consolidation while US Treasuries pullback in their uptrend. The Shanghai Composite looks to continue the messy uptrend while Emerging Markets stall in their move higher.

EARNING UPDATE $BEN Franklin Resources, Inc. for quarter ending q_Sep18 – Revenue fell but Margins expanded

[s2If !current_user_can(access_s2member_level0)]Please login to read the earning update on BEN [lwa][/s2If][s2If current_user_can(access_s2member_level0)]Franklin Resources, Inc. reported earnings (EPS) of 0.00 per share for the quarter ending q_Sep18. This is vis-vis 0.75 per share for the previous quarter ending q_Jun18, a decline of 100 %. Compared to last year same quarter (q_Sep17), earnings…

$BEN 2018-08-03 : Transcripts- Edited Transcript of BEN earnings conference call

[s2If !current_user_can(access_s2member_level0)] Please login to read the transcript. [lwa] [/s2If][s2If current_user_can(access_s2member_level0)]”

Q3 2018 Franklin Resources Inc Earnings Call

SAN MATEO Aug 4, 2018 (Thomson StreetEvents) — Edited Transcript of Franklin Resources Inc earnings conference call or presentation Friday, July 27, 2018 at 3:00:00pm GMT

TEXT version of Transcript

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EARNING UPDATE $BEN Franklin Resources, Inc. for quarter ending q_Jun18 – Revenue rose but Margins contracted

[s2If !current_user_can(access_s2member_level0)]Please login to read the earning update on BEN [lwa][/s2If][s2If current_user_can(access_s2member_level0)]Franklin Resources, Inc. reported earnings (EPS) of 0.75 per share for the quarter ending q_Jun18. This is vis-vis 0.78 per share for the previous quarter ending q_Mar18, a decline of 3.8 %. Compared to last year same quarter (q_Jun17), earnings…

JOHNSON GREGORY E (Chairman and CEO) has executed an insider transaction in BEN . A total of 49988 were in Sell transaction. The trade happened at 43.58. The stock current price is 43.69. The transaction was reported on Sell The pattern and the details of insider transaction in BEN can be observed belowInsider Sell BEN040,00080,000120,000160,000200,000240,000280,000320,000360,000400,0002016-12-09…

Stocks have soared ever since Donald Trump stunned everyone by winning the presidency, but Trump’s victory was far from a landslide mandate. Hillary Clinton won the popular vote by over 2.6M votes. This marks the fifth time a president has won the electoral college but lost the popular vote—and Trump’s popular vote deficit was much larger than the previous four times this election outcome occurred.

But before Democrats claim a moral victory, they would be wise to examine the congressional tally. According to the Wall Street Journal, Republicans won 3M more House votes than Democrats. That means a staggering 5.5M voters picked Clinton and then voted for a Republican congressional candidate—which not only speaks volumes to Trump’s personal unpopularity, but to the rightward drift of white voters.  

The ongoing Trump Rally shows that markets approve of PEOTUS’s vow to lower corporate taxes, simplify personal taxes (Trump wants to reduce today’s seven rates to three), and reduce regulations. Energy and financial stocks have gained the most, while tech stocks have lagged. Last year’s big winners, the so-called FANG stocks (Facebook, Amazon, Netflix and Google) have not participated in this celebratory advance.

I anticipate that this trend will continue. Trump lost tech-rich California by 4M votes. Not surprisingly, his ‘kitchen cabinet’ features no Silicon Valley luminaries. From a regulatory standpoint, tech has the most to fear from the new administration. Early in his candidacy, Trump lamented the destruction to local merchants from Amazon (and Trump is also no fan of the Jeff Bezos-owned Washington Post.) Despite the new president’s penchant for late-night tweeting, investors should be wary of owning social media stocks, given their rich valuations and the potential adversarial relationship with Washington.

Wall Street and financial industry stocks have fared better since election day and should continue to do so. Trump wants to end the Fed’s zero interest rate policy and has pledged to purge the Fed of doves like Chairwoman Janet Yellin, whose term expires in early 2018. Higher rates will increase bank profits by increasing the net interest margin from lending. If Dodd-Frank is gutted, smaller banks should grow faster, as well.  

But investors need to be careful what they wish for. Less than a decade ago, we got a crash course in the consequences of an unregulated Wall Street. The Consumer Financial Protection Bureau has reduced predatory behavior like payday loans, exorbitant credit card fees, and destructive mortgage terms like negative amortization (thank you Golden West and the Sandlers for making these toxic loans commonplace). Moreover, the recent Department of Labor edict forcing advisors to be fiduciaries first and salespeople second should reduce the excessive fees embedded in mutual funds and other investments. Despite some hopes on Wall Street that the Trump Administration will block implementation of this law in 2017, I suspect it will be enacted as written, and the mutual fund world will either have to adapt or continue to lose assets. I would not own—and might short—the worst positioned players like Waddell & Reed and Franklin Funds.

There’s a fascinating trend happening within the asset management industry where the public is using data and the information available online to make better investing decisions, slowly but surely. There is absolutely zero data that links high fund costs with outperformance over any relevant period of time and the “persistence” data from SPIVA has done a number on the idea that investors who overpay for active management get what they pay for.

Investors are leaving higher cost funds and gravitating toward lower cost funds. I would surmise that the education they are getting on financial blogs and from their advisors is helping to drive this trend.

A new Morningstar study released today shows that the asset-weighted expense ratio across all funds (including mutual funds and exchange-traded products, or ETPs, but excluding money market funds and funds of funds) was 0.64% in 2014, down from 0.65% in 2013 and 0.76% five years ago. The trend is being driven more by investors seeking low-cost funds than it is by fund companies cutting fees.

The data is undeniable: the investor class is learning:

Mutual funds and ETPs with expense ratios ranking in the least-expensive quintile of all funds attracted an aggregate $3.03 trillion of estimated net inflows during the past 10 years, compared with just $160 billion for funds in the remaining four quintiles. That is to say that 95% of all flows have gone into funds in the lowest-cost quintile.

There is an implied link to the fact that service models among financial advisors have shifted dramatically in recent years. There are many more clients now being served by fee-based financial advisors than pure transactional brokers – a trend I have documented laboriously on this site and in my book.

With less brokers, there is the commensurate decline in the type of funds brokers favor (the ones that pay them most). Broker-sold or “load” funds are going the way of the dodo in place of ETFs in wrap accounts or institutional share class mutual funds. Morningstar notes that “Load shares, which charged an asset-weighted expense ratio of 1.02% in 2014, held just 20% of assets as of year-end, down from 37% in 2004.”

The pendulum is not going to be swinging back to higher-cost funds any time soon, contra the opinion of Fidelity’s chief Abigail Johnson. Actively managed funds will either react by rationalizing their costs or continue to watch the dollars flow out.

One other anomaly worth mentioning – investors are allocating to one area with higher than average fees, the liquid alts space. That said, it’s such a small pocket of the overall fund biz that it’s hardly worth mentioning at this point. Time will tell whether liquid alts can grow into a much large contributor to the industry and still maintain high internal expense ratios.

Source:

Investors Drive Expense Ratios Down (Morningstar)

2015 Fee Study: Investors Are Driving Expense Ratios Down (Morningstar)