Lazard (NYSE:LAZ – Get Free Report) and Sprott (NYSE:SII – Get Free Report) are both mid-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, valuation and dividends.
Risk and Volatility
Lazard has a beta of 1.47, indicating that its stock price is 47% more volatile than the S&P 500. Comparatively, Sprott has a beta of 0.95, indicating that its stock price is 5% less volatile than the S&P 500.
Dividends
Lazard pays an annual dividend of $2.00 per share and has a dividend yield of 5.5%. Sprott pays an annual dividend of $1.60 per share and has a dividend yield of 1.4%. Lazard pays out 98.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sprott pays out 39.2% of its earnings in the form of a dividend. Sprott has increased its dividend for 1 consecutive years.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Lazard | 6.95% | 23.58% | 4.63% |
| Sprott | 26.36% | 28.40% | 20.95% |
Analyst Ratings
This is a summary of current ratings and recommmendations for Lazard and Sprott, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Lazard | 2 | 4 | 4 | 0 | 2.20 |
| Sprott | 0 | 1 | 2 | 0 | 2.67 |
Lazard presently has a consensus target price of $49.00, suggesting a potential upside of 35.90%. Sprott has a consensus target price of $230.00, suggesting a potential upside of 98.32%. Given Sprott’s stronger consensus rating and higher probable upside, analysts plainly believe Sprott is more favorable than Lazard.
Valuation and Earnings
This table compares Lazard and Sprott”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Lazard | $3.10 billion | 1.29 | $236.83 million | $2.04 | 17.67 |
| Sprott | $386.26 million | 7.72 | $67.35 million | $4.08 | 28.43 |
Lazard has higher revenue and earnings than Sprott. Lazard is trading at a lower price-to-earnings ratio than Sprott, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
54.8% of Lazard shares are held by institutional investors. Comparatively, 28.3% of Sprott shares are held by institutional investors. 0.9% of Lazard shares are held by insiders. Comparatively, 18.3% of Sprott shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Summary
Sprott beats Lazard on 11 of the 17 factors compared between the two stocks.
About Lazard
Lazard, Inc., together with its subsidiaries, operates as a financial advisory and asset management firm in North and South America, Europe, the Middle East, Asia, and Australia. It operates in two segments, Financial Advisory and Asset Management. The Financial Advisory segment offers financial advisory services, such as mergers and acquisitions, capital markets, shareholder, sovereign, geopolitical advisory, and other strategic advisory services, as well as restructuring and liability management, and capital raising and placement services. This segment offers its services to corporate, partnership, institutional, government, sovereign, and individual clients to various industry areas, including consumers, financial institutions, healthcare and life sciences, industrials, power and energy/infrastructure, real estate, technology, telecommunication, and media and entertainment. The Asset Management segment offers a range of investment solutions; investment and wealth management services in equity and fixed income strategies; asset allocation strategies; and alternative investments and private equity funds to corporations, public funds, sovereign entities, endowments and foundations, labor funds, financial intermediaries, and private clients. Lazard, Inc. was incorporated in 1848 and is headquartered in New York, New York.
About Sprott
Sprott Inc. is a publicly owned asset management holding company. Through its subsidiaries, the firm provides asset management, portfolio management, wealth management, fund management, and administrative and consulting services to its clients. It offers mutual funds, hedge funds, and offshore funds, along with managed accounts. Further, the firm also provides broker-dealer activities. Sprott Inc. was formed on February 13, 2008 and is based in Toronto, Canada.
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