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Note D - Marketable Equity Securities
 6 Months Ended
Jun. 30, 2023
Notes to Financial Statements  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE D: MARKETABLE EQUITY SECURITIES

The Company’s investments in marketable securities consist of equity securities with readily determinable fair values. The cost of securities sold is based on the specific identification method, and interest and dividends on securities are included in non-operating income.

 

Marketable equity securities are carried at fair value, with gains and losses in fair market value included in the determination of net income. The fair value of marketable equity securities is determined based on quoted market prices in active markets, as described in Note J.

 

The following table sets forth market value, cost, and unrealized gains on equity securities as of June 30, 2023 and December 31, 2022.

 

  

June 30, 2023

  

December 31, 2022

 
  

(in thousands)

 

Fair market value

 $41,274  $41,728 

Cost

  30,349   30,350 

Unrealized gain

 $10,925  $11,378 

 

The following table sets forth the gross unrealized gains and losses on the Company’s marketable securities as of June 30, 2023 and December 31, 2022.

 

  

June 30, 2023

  

December 31, 2022

 
  

(in thousands)

 

Gross unrealized gains

 $13,480  $13,478 

Gross unrealized losses

  2,555   2,100 

Net unrealized gain

 $10,925  $11,378 

 

The Company did not sell any marketable equity securities and had no realized gains or losses during the six months ending on June 30, 2023 or 2022, respectively.

 

For the quarter ended June 30, 2023, the Company recognized dividends received of approximately $362,000 in non-operating income in its condensed consolidated statements of operations. For the six months ended June 30, 2022, the Company recognized dividends received of approximately $357,000 in non-operating income in its condensed consolidated statements of operations.

 

The Company’s equity securities are periodically used as collateral against any outstanding margin account borrowings. As of June 30, 2023, and December 31, 2022, the Company had outstanding borrowings of approximately $739,000 and $914,000, respectively, under its margin account. Margin account borrowings are used for the purchase of marketable equity securities and as a source of short-term liquidity and are included in accrued expenses and other liabilities on our condensed consolidated balance sheets.

 

Our marketable equity securities portfolio had a net unrealized pre-tax loss in market value of approximately $165,000 during the second quarter of 2023, and a net unrealized pre-tax loss in market value of approximately $3,349,000 during the second quarter of 2022, which were reported as non-operating income in its condensed consolidated statements of operations for the respective periods.