U.S. Global stock slides on lower Q3 earnings
Shares of U.S. Global Investors Inc. (Nasdaq: GROW) dipped on heavy volume this morning after the company reported decreased net income for its fiscal third quarter.
The San Antonio-based boutique investment advisory firm posted net income of $2.4 million, or 16 cents per share, on revenue of $12.4 million for the quarter ended March 31. U.S. Global recorded net income of $2.6 million, or 17 cents per share, on revenue of $11.6 million in the year-ago quarter. There were no analysts’ estimates available.
The quarter earning’s included non-recurring expenses primarily associated with a proxy election that resulted in a 2-for-1 stock split in late March. Excluding the charge, net income totaled $2.58 million, or 17 cents per share.
U.S. Global's SEC-registered fund assets under management averaged $4.6 billion for the third quarter of fiscal 2007, up 21.4 percent from the average of $3.8 billion for the same period a year earlier.
U.S. Global CEO Frank Holmes said the housing slowdown and subprime mortgage debt are negatively impacting growth in the United States. Investors, he added, “appear to be ignoring the rise in commodity prices in the first quarter of 2007.”
Also, he noted that the “supply of commodities continues to be constrained at a time when global demand, particularly in China and India, is growing rapidly.”
U.S. Global joined the Russell Microcap Index.last July. The registered investment adviser manages 13 no-load mutual funds.
U.S. Global’s stock was down $2.38, or 8.5%, to $25.51 this morning after having dropped to $24.60 earlier in the day. It has traded between $17.56 (on July 21) and $72.72 (on Dec. 29) in the past year.
Volume was heavy – by 11:16 AM ET, more than 1.6 million shares had changed hands, compared with an average three-month daily volume of 1.9 million shares.
