U.S. Global Investors announces update to $5M stock buyback program

U.S. Global Investors (NASDAQ:GROW) has announced an update to its stock repurchase program allowing it to purchase up to $5 million worth of stock, representing 14% of its market capitalization, between September 13, 2024 and December 31, 2024.

The updated buyback program is part of the company’s strategy to return excess capital to shareholders, U.S. Global said.

It will continue to purchase shares when its Class A shares are equal to or below the previous day’s closing price or if the stock trades below a certain amount per share. It may also purchase a block of up to 100,000 shares on a downtick, usually at the bid or below.

“We believe that repurchasing our shares at current levels offers a compelling opportunity to enhance shareholder value,” U.S. Global Investors (NASDAQ:GROW) CEO Frank Holmes commented.

“By reducing the number of outstanding shares, we aim to increase earnings per share (EPS) and provide greater ownership value to our shareholders. This buyback, alongside our ongoing monthly dividend, demonstrates our confidence in the company’s strong financial foundation and future potential.”

Additionally, the company’s board has approved a dividend payment fo $0.0075 per share per month beginning in October 2024 through to December 2024.

At the September 18 closing price of $2.54, the monthly dividend equal a 3.54% yield on an annualized basis.

“We understand that having a strong shareholder yield is important for stock growth,” Holmes said.

“It measures how much value a company returns to its shareholders through dividends, buybacks and debt reduction. We believe that by focusing on these items, we can create a more attractive investment proposition.”

In its statement, the company also noted the positive performance of gold, which has surged about $2,500 per ounce. Gold is an important asset to many of U.S. Global’s investments.

“The yellow metal is trading above its 50-day moving average, which we consider to be a bullish signal and which many trend investors follow,” Holmes said.

“As many are aware, the price of gold has historically shared an inverse relationship with Treasury yields. The yield on the 10-year Treasury note, now below its 200-day moving average, has fallen to a 52-week low of 3.6%.”