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Investing.com - TD Cowen downgraded Sprott Inc . (TSX:SII) (OTC:SPOXF (OTC:SII)) from Buy to Hold on Tuesday, maintaining a price target of C$100.00 as the stock’s significant year-to-date gains limit further upside potential.
The research firm cited Sprott’s 71% share price appreciation year-to-date as the primary reason for the rating change, suggesting the stock’s strong performance has largely captured its near-term growth prospects.
TD Cowen noted that while Sprott has experienced material assets under management (AUM) growth, resulting in an improved earnings outlook, the stock’s valuation has simultaneously increased to levels that may constrain additional upside.
The firm pointed out that Sprott currently trades at 29.7x price-to-earnings (P/E) on a forward four-quarter basis, which exceeds its five-year average of 23.0x and represents a premium to alternative asset manager peers trading at 25.5x.
TD Cowen’s C$100.00 target price implies a 27.1x multiple on Sprott’s 2026 estimated earnings per share, compared to an average multiple of 21.6x implied by target prices for other alternative asset managers under the firm’s coverage.
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