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Summary of Operations
U.S. Global is company located in Texas with two main segments: Investment Management Services and Corporate Investments. Fees for investment advisory services and administration of mutual funds are their primary sources of revenue. These efforts involve managing the portfolios of clients but also their own. In 2021, the U.S. Global Jets ETF (JETS) was responsible for 72% of revenues.
Strategy
The company is smaller than most other mutual funds and financial institutions and has less resources to leverage. It believes its competitive edge comes from its team’s expertise on gold mining, natural resources, and emerging markets. The company has no debt and finances operations with its own cash.
Growth and the Future
The company intends to pay monthly cash dividends, so it has potential as an income stock. Otherwise, growth will depend on its ability to maintain revenues from its investment services and from the gains of its own investments. The company notes that market fluctuations have a major impact on revenues, as customers may withdraw or add funds in reaction to the market. Its current market cap is quite small, so there is potential for growth.
This page shows the composition of their funds and a potential bag of good stocks for separate analysis. This page shows their concentration in airlines, which I find a bit risky.
Valuation
Given the complexity of the company’s portfolio and what I find to be risk in airlines, I will not do a valuation.
Growth Assumptions: N/A
Intrinsic Value Per Share: $N/A
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