Head-To-Head Comparison: Sprott (NYSE:SII) versus U.S. Global Investors (NASDAQ:GROW)

Sprott (NYSE:SII) and U.S. Global Investors (NASDAQ:GROW) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Earnings & Valuation

This table compares Sprott and U.S. Global Investors”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sprott	$178.65 million	19.06	$49.29 million	$1.95	67.69
U.S. Global Investors	$8.45 million	4.06	-$330,000.00	$0.06	44.17

Sprott has higher revenue and earnings than U.S. Global Investors. U.S. Global Investors is trading at a lower price-to-earnings ratio than Sprott, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sprott and U.S. Global Investors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sprott	23.26%	15.01%	11.97%
U.S. Global Investors	10.04%	1.86%	1.75%

Risk and Volatility

Sprott has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500. Comparatively, U.S. Global Investors has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for Sprott and U.S. Global Investors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sprott	0	2	2	0	2.50
U.S. Global Investors	0	1	0	0	2.00

Sprott currently has a consensus target price of $132.00, suggesting a potential downside of 0.00%. Given Sprott’s stronger consensus rating and higher possible upside, equities analysts plainly believe Sprott is more favorable than U.S. Global Investors.

Dividends

Sprott pays an annual dividend of $1.60 per share and has a dividend yield of 1.2%. U.S. Global Investors pays an annual dividend of $0.09 per share and has a dividend yield of 3.4%. Sprott pays out 82.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. U.S. Global Investors pays out 150.0% 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 has raised its dividend for 1 consecutive years.

Insider & Institutional Ownership

28.3% of Sprott shares are held by institutional investors. Comparatively, 23.6% of U.S. Global Investors shares are held by institutional investors. 18.3% of Sprott shares are held by company insiders. Comparatively, 19.2% of U.S. Global Investors shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Sprott beats U.S. Global Investors on 15 of the 17 factors compared between the two stocks.

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.

About U.S. Global Investors

U.S. Global Investors, Inc. is a publicly owned investment manager. It primarily provides its services to investment companies. The firm is a large advisory firm, an investment adviser to an investment company which provides portfolio management for investment companies. The firm manages and launches equity/balanced funds, fixed income funds and other funds. It also manages hedge funds. The firm primarily invests in no-load mutual funds and exchange traded funds (ETFs). U.S. Global Investors, Inc. is based in San Antonio, Texas.