U.S. Global Investors (NASDAQ:GROW) has reported its financial results for the first quarter which ended March 31, 2024.
The investment firm focused on niche markets said its shareholder yield for the quarter was 8.32%, higher than the yields on the five-year and 10-year Treasury.
Average assets under management were $1.8 million for the period, which it described as a “challenging” March quarter.
Operating revenue was $2.6 million and net income was mostly flat which US Global Investors attributed to a decrease in advisory fees, lower investment income, and lower assets under management compared to the previous quarter and the same quarter a year ago.
“We consider GROW a deep-value stock, especially with the Federal Reserve keeping rates higher for longer,” CEO Frank Holmes said.
“Higher borrowing costs affect companies of all sizes, but they put substantial pressure on small and microcap stocks, which are generally more sensitive to economic shifts and smaller financial cushions.”
Additionally, US Global Investors said it repurchased 211,282 of its shares for $577,000, marking a 9.4% increase from the same period in 2023.
It exited the quarter with net working capital of $38.6 million, up by $1.2 million from June 30, 2023, and approximately $27.5 million in cash and cash equivalents.
After the quarter ended, the company’s Europe-domiciled airlines ETF, the US Global Jets UCITS ETF (JETS) merged into the Travel UCITS ETF (TRIP), effective April 19.
The company expects this to increase JETS’ assets under management fivefold and further solidify its position as a leader in thematic investing.
“TRIP presents a unique opportunity for the company to increase assets from around $5 million to $20 million,” Holmes said.
“We’re confident that our expertise in the quantamental investment space has unlocked new avenues for shareholders, both domestically and internationally, as evidenced in this merger.”
