Quarterly report pursuant to Section 13 or 15(d)

Marketable Securities

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Marketable Securities
 9 Months Ended
Sep. 30, 2022
Marketable Securities  
Marketable Securities

Note 6: Marketable Securities

 

The Company classifies and accounts for its marketable debt securities as available-for-sale and the securities are stated at fair value.

 

The investments in marketable securities had an adjusted cost basis of $97.5 million and a market value of $89.9 million as of September 30, 2022. The balances consisted of the following securities (in thousands):

                       
    Adjusted Cost     Unrealized Gain/(Loss)     Fair Value  
Corporate Bonds   $ 44,822     $ (2,968 )   $ 41,854  
U.S. Treasury     20,922       (1,437 )     19,485  
Mortgage-Backed     6,285       (760 )     5,525  
U.S. agency and government sponsored securities     13,116       (1,495 )     11,621  
U.S. states and municipalities     11,818       (988 )     10,830  
Asset-Backed     567       (9 )     558  
Total   $ 97,530     $ (7,657 )   $ 89,873  

 

The investments in marketable securities had an adjusted cost basis of $113.8 million and a market value of $112.5 million as of December 31, 2021. The balances consisted of the following securities (in thousands):

                   
    Adjusted Cost     Unrealized Gain/(Loss)     Fair Value  
Corporate Bonds   $ 47,864     $ (529 )   $ 47,335  
U.S. Treasury     24,410       (257 )     24,153  
Mortgage-Backed     7,504       (143 )     7,361  
U.S. agency and government sponsored securities     14,675       (87 )     14,588  
U.S. states and municipalities     11,871       (189 )     11,682  
Asset-Backed     6,456       (50 )     6,406  
Commercial paper     998       –       998  
Total   $ 113,778     $ (1,255 )   $ 112,523  

 

The Company reported the net unrealized losses in accumulated other comprehensive (loss) income, a component of stockholders' equity. The decline in fair value is largely due to changes in interest rates and other market conditions and is expected to recover as the securities approach maturity. The Company has evaluated these securities and determined that no allowance is necessary based on the credit quality and the low risk of loss due to the security type. The Company holds sixty-two available-for-sale securities, all of which are in an unrealized loss position as of September 30, 2022. The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period greater than 12 months as of September 30, 2022 are as follows (in thousands):

           
   

Gross

Unrealized Loss

     Fair Value  
Corporate Bonds   $ (2,375 )   $ 34,365  
U.S. Treasury     (1,456 )     19,489  
Mortgage-Backed     (829 )     5,528  
U.S. agency and government sponsored securities     (1,493 )     11,625  
U.S. states and municipalities     (781 )     8,020  
Asset-Backed     (10 )     558  
Total   $ (6,944 )   $ 79,585  

 

As of December 31, 2021, the Company had not yet held marketable securities in an unrealized loss position for greater than twelve months. A net realized loss of $36,332 and $159,624 related to the prepayment of principals for certain mortgage-backed securities was recorded in earnings during the three and nine months ended September 30, 2022, respectively.

 

The contractual maturities of the Company’s marketable investments as of September 30, 2022 were as follows (in thousands):

     
    Fair Value  
Due within 1 year   $ 8,889  
Due after 1 year through 5 years     70,060  
Due after 5 years through 10 years     3,752  
Due after 10 years     7,172  
Total   $ 89,873  

 

The Company may sell certain of its marketable debt securities prior to their stated maturities for reasons including, but not limited to, managing liquidity, credit risk, duration and asset allocation.

 

The Company did not sell any securities during the three or nine months ended September 30, 2022 that resulted in material gains or losses.