Sprott Founder's Silver Hype Masks Fundamental Data Gaps

What happened

Eric Sprott's interview with Kitco News promotes a $300 silver squeeze and aggressive mining investments, stirring speculative interest in Sprott Inc. DeepValue's master report reveals the stock trades at elevated valuations (P/E 43.7x) based on assumptions of sustained net inflows into physical precious metals trusts. However, the last consolidated AUM update was $51B in October 2025, with no recent data to confirm ongoing net subscriptions versus market appreciation. Critical to the investment thesis is the PSLV ATM program's ability to convert silver demand into AUM, but evidence of its effective utilization remains unverified. Investors must look beyond promotional narratives to upcoming AUM disclosures for confirmation of the fee-growth engine.

Implication

The Kitco interview amplifies narrative-driven volatility, but Sprott's business model hinges on AUM growth from net subscriptions, not silver price speculation. High valuation multiples (P/E 43.7x, EV/EBITDA 40.1x) leave little margin for error, with a bear scenario implying $80 per share if flows reverse. The PSLV ATM program's success is essential for capturing demand, but without recent data, its effectiveness is uncertain. Upcoming AUM updates in the next 3-6 months are crucial to assess whether net inflows persist or if growth is merely price-driven. Thus, investors should adhere to a WAIT rating, avoiding new positions until fundamental data aligns with the optimistic narrative.

Thesis delta

The promotional article does not alter the core investment thesis, which remains dependent on verified net inflows and AUM growth beyond October 2025. However, it highlights the risk of sentiment-driven price swings detached from underlying fundamentals. Investors should prioritize monitoring for AUM disclosures and PSLV utilization over speculative commentary.