Analyzing Trinity Capital (NASDAQ:TRIN) and Franklin Resources (NYSE:BEN)

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

Earnings and Valuation

This table compares Franklin Resources and Trinity Capital”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franklin Resources	$9.32 billion	1.89	$524.90 million	$1.47	23.57
Trinity Capital	$216.31 million	7.93	$135.60 million	$1.75	10.35

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

Profitability

This table compares Franklin Resources and Trinity Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franklin Resources	8.72%	11.55%	4.46%
Trinity Capital	43.45%	14.94%	6.69%

Dividends

Franklin Resources pays an annual dividend of $1.32 per share and has a dividend yield of 3.8%. Trinity Capital pays an annual dividend of $2.04 per share and has a dividend yield of 11.3%. Franklin Resources pays out 89.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Trinity Capital pays out 116.6% 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 has raised its dividend for 45 consecutive years and Trinity Capital has raised its dividend for 1 consecutive years.

Insider & Institutional Ownership

47.6% of Franklin Resources shares are held by institutional investors. Comparatively, 24.6% of Trinity Capital shares are held by institutional investors. 23.4% of Franklin Resources shares are held by company insiders. Comparatively, 4.3% of Trinity Capital shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility & Risk

Franklin Resources has a beta of 1.54, indicating that its stock price is 54% more volatile than the S&P 500. Comparatively, Trinity Capital has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Franklin Resources and Trinity Capital, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franklin Resources	2	5	4	0	2.18
Trinity Capital	1	1	4	1	2.71

Franklin Resources presently has a consensus price target of $32.44, suggesting a potential downside of 6.35%. Trinity Capital has a consensus price target of $16.67, suggesting a potential downside of 8.01%. Given Franklin Resources’ higher possible upside, analysts clearly believe Franklin Resources is more favorable than Trinity Capital.

Summary

Franklin Resources beats Trinity Capital on 9 of the 17 factors compared between the two stocks.

About Franklin Resources

Franklin Resources, Inc. is a publicly owned asset management holding company. Through its subsidiaries, the firm provides its services to individuals, institutions, pension plans, trusts, and partnerships. It launches equity, fixed income, balanced, and multi-asset mutual funds through its subsidiaries. The firm invests in the public equity, fixed income, and alternative markets. Franklin Resources, Inc. was founded in 1947 and is based in San Mateo, California with an additional office in Calgary, Canada; Dubai, United Arab Emirates; Edinburgh, United Kingdom; Fort Lauderdale, United States; Hyderabad, India; London, United Kingdom; Rancho Cordova, United states; Shanghai, China; Singapore; Stamford, United States; and Vienna, Austria.

About Trinity Capital

Trinity Capital Inc. is a business development company. It is a venture capital firm specializing in venture debt to growth stage companies looking for loans and/or equipment financing. Trinity Capital Inc. was founded in 2019 is based in Phoenix, Arizona with additional offices in the United States.