Head to Head Analysis: America First Multifamily Investors (ATAX) & Franklin Resources (BEN)

America First Multifamily Investors (NASDAQ: ATAX) and Franklin Resources (NYSE:BEN) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, risk, dividends and earnings.

Profitability

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This table compares America First Multifamily Investors and Franklin Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
America First Multifamily Investors 37.79% 10.06% 2.93%
Franklin Resources 10.44% 13.88% 9.91%

Volatility & Risk

America First Multifamily Investors has a beta of 0.35, indicating that its share price is 65% less volatile than the S&P 500. Comparatively, Franklin Resources has a beta of 1.59, indicating that its share price is 59% more volatile than the S&P 500.

Dividends

America First Multifamily Investors pays an annual dividend of $0.50 per share and has a dividend yield of 8.1%. Franklin Resources pays an annual dividend of $0.92 per share and has a dividend yield of 2.8%. America First Multifamily Investors pays out 113.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Franklin Resources pays out 30.6% of its earnings in the form of a dividend. Franklin Resources has raised its dividend for 36 consecutive years.

Insider and Institutional Ownership

6.7% of America First Multifamily Investors shares are owned by institutional investors. Comparatively, 47.0% of Franklin Resources shares are owned by institutional investors. 1.3% of America First Multifamily Investors shares are owned by insiders. Comparatively, 22.2% of Franklin Resources shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares America First Multifamily Investors and Franklin Resources’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
America First Multifamily Investors $70.38 million 5.30 $30.59 million $0.44 14.03
Franklin Resources $6.39 billion 2.89 $1.70 billion $3.01 11.11

Franklin Resources has higher revenue and earnings than America First Multifamily Investors. Franklin Resources is trading at a lower price-to-earnings ratio than America First Multifamily Investors, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and recommmendations for America First Multifamily Investors and Franklin Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
America First Multifamily Investors 0 1 0 0 2.00
Franklin Resources 3 5 0 0 1.63

America First Multifamily Investors presently has a consensus target price of $6.00, indicating a potential downside of 2.83%. Franklin Resources has a consensus target price of $42.13, indicating a potential upside of 25.93%. Given Franklin Resources’ higher possible upside, analysts plainly believe Franklin Resources is more favorable than America First Multifamily Investors.

Summary

Franklin Resources beats America First Multifamily Investors on 11 of the 16 factors compared between the two stocks.

America First Multifamily Investors Company Profile

America First Multifamily Investors, L.P. is engaged in acquiring, holding, selling and dealing with a portfolio of mortgage revenue bonds, which have been issued to provide construction and/or permanent financing for multifamily and student housing (collectively Residential Properties) and commercial properties. Its segments are Mortgage Revenue Bond Investments, MF Properties, Public Housing Capital Fund Trusts and mortgage-backed securities (MBS) Investments. Its Mortgage Revenue Bond Investments segment consists of its portfolio of mortgage revenue bonds, which have been issued to provide construction and/or permanent financing for the residential properties and a commercial property. The MF Properties segment consists of indirect equity interests in multifamily, student housing, and senior citizen residential properties, which are not financed by mortgage revenue bonds held by the Company, but which it intends to finance by such bonds through a restructuring.

Franklin Resources Company Profile

Franklin Resources, Inc. is a holding company. The Company, along with its subsidiaries, operates as Franklin Templeton Investments. It is a global investment management company that provides investment management and related services to retail, institutional and high net-worth clients in jurisdictions around the world. The Company offers its investment products and services under the Franklin, Templeton, Franklin Mutual Series, Franklin Bissett, Fiduciary Trust, Darby, Balanced Equity Management, K2 and LibertyShares brand names. Its products include investment funds and institutional, high net-worth and separately managed accounts (collectively, sponsored investment products (SIPs)). It offers various types of SIPs, such as the United States funds, cross-border funds, local/regional funds, and other managed accounts, alternative investment products and trusts. Its investment funds include the United States-registered funds, non-United States-registered funds and unregistered funds.

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