From Yahoo Finance: 2025-04-17 18:24:00

In 2025, Franklin Resources, Inc. (NYSE:BEN) is ranked among the top 10 dividend trap stocks to avoid. Market conditions are revealing risks underneath seemingly reliable dividend stocks due to shifting market conditions, uncertainty, and the impact of U.S. tariffs on companies, including a decline in profit margin and potential income erosion for investors.

Analysts have revised earnings growth estimates to flat or negative outcomes for market indices due to uncertainty and caution. The U.S. tariffs and resulting trade war with China have disrupted global asset markets, causing companies, including dividend payers, to face cost shocks and profit margin declines, impacting investor income.

Investor sentiment is shifting, leading to a wait-and-see approach, slowdown in mergers and acquisitions, and restructuring of supply chains. Companies are prioritizing liquidity and short-term cost optimization, potentially affecting dividends as a budget item to be slashed, emphasizing the risk of blindly chasing high yields in uncertain market conditions.

Franklin Resources, Inc. (NYSE:BEN) has experienced a decline in performance by 31.89% and offers a 7.31% dividend yield with a high payout ratio of 195.31%, raising concerns about sustainability. Despite being a global investment management firm offering mutual funds and ETFs, the company’s recent financial performance has been affected by ongoing investigations and outflows at Western Asset Management.

Franklin Resources, Inc. (NYSE:BEN) ranks 4th on the list of top dividend trap stocks to avoid in 2025 due to its high payout ratio and performance concerns. Despite offering an attractive dividend yield, the company’s sustainability of returns is questionable, leading to a recommendation to consider alternative investment opportunities, such as AI stocks, for potentially higher returns within a shorter time frame.



Read more at Yahoo Finance: Is Franklin Resources (BEN) a Dividend Trap to Avoid in 2025?