FHN - Cowen maybe be worth for $50-$60/shar or more a potential sale - analyst

A potential Cowen ( NASDAQ: COWN ) sale would likely need to have a $5 or $6 as the first digit, according to JMP Securities, after a report late Friday that Toronto-Dominion Bank ( NYSE: TD ) was said to be  considering making an offer for the brokerage firm. Cowen shares surged 25% on Monday, while TD fell 3.9%.

"We believe the starting point for a conversation around the clearing price for Cowen will likely not be in the $30 range or even $40 range, but most likely needs to have a $5 or $6 in front of it," JMP analyst Devin Ryan wrote in a note on Monday. " Even at these prices, it is not clear to us whether Cowen would even be interested and whether TD Bank would want to bridge the gap (or potentially get creative in structure) ..."

Bloomberg reported on Friday that TD Bank is working with advisors to analyze a potential deal for the broker. No final decision has been made. Cowen ( COWN ) has a market cap of $668 million.

Cowen executives may be incentivized to sell as the executive team would receive $70 million in cash payments under a change of control, up from $45 million just a year ago, according to JMP's Ryan, who has a market outperform and $60 price target for Cowen ( COWN ).

"Simply put, we do not see any pressure for Cowen to sell, particularly in a backdrop with depressed valuations," Ryan wrote. "On the other hand, we think a price always exists and we can understand the strategic rationale."

TD Bank ( TD ) back is already involved in another large acquisition after it agreed to buy First Horizon ( FHN ) for $13.4 billion in February , a deal that may see an extended timeline due to regulatory scrutiny.

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