Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of asset manager Cohen & Steers (NYSE: CNS) surged as much as 10% in late-day trading today.

So what: It took awhile for yesterday's Cohen earnings news to filter out. As late as noon today, shares still traded for the relatively low price of $39 and change, just a few percentage points above yesterday. That didn't last long. Year-over-year revenue growth of 39%, and profits that rose 33% (to $0.36 per share), were just too good for investors to pass up.

Now what: Deeper in the earnings report, Cohen revealed that its 33% gain in profits didn't quite jibe with the massive 69% increase in the company's assets under management -- from $26.2 billion to $44.3 billion year over year. So how come profits on these greater funds grew less than half that fast?

The stock now costs 35 times earnings, but it's only expected to grow those earnings at about 5% per year over the next five years. Furthermore, the market traditionally prices asset managers at roughly 2% of AUM. In Cohen's case, that argues in favor of a sub-$900 million valuation, compared to its current $1.7 billion market cap.

Congratulations to the longs, who are sitting on some pretty fat profits at day's end. But don't get greedy. At these prices, I fear those profits may be fleeting.

Will Rich's pessimism prove out, or can Cohen steer itself to ever-higher stock prices? Add it to your Watchlist and find out.

Fool contributor Rich Smith holds no position in any company mentioned. Click here to see his holdings and a short bio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.