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| It is not difficult to locate financial information about a company
traded publicly on one of the major U.S. stock exchanges like The New
York Stock Exchange (NYSE) or The American Stock Exchange (Amex). Most
publicly traded companies that do not belong to one of the major stock
exchanges trade on the Over The Counter (OTC) market and are part of the
National Association of Securities Dealers Automated Quotation (NASDAQ)
system. Locating financial information about NASDAQ stocks is also not
difficult. All the companies whose stocks are listed on one of these stock
trading systems must file a plethora of financial data with the Securities
and Exchange Commission (SEC), and this data is made publicly available
through numerous print and online resources.
However, probably contrary to what most individual investors believe, the NASDAQ system does not include all OTC stocks. There are thousands of infrequently traded stocks not listed on one of the exchanges or in the NASDAQ system. These are called "unlisted " stocks. They may not belong to one of the "majors" for any number of reasons including an asset base that is too small, a low trading volume, the substantial cost of being listed on one of "the majors," or the desire to avoid having to file those quarterly and annual SEC reports. Obtaining financial information about unlisted companies can be difficult. As mentioned earlier, some of these companies are even exempt from the annual SEC reporting requirements because of the small number of stockholders. These companies are often quite protective of their financial information. An attempt is made to track them through one of several sources collectively known as the "pink sheets." This name was adopted because one of the oldest of these sources, the National Quotation Bureau, actually publishes the unlisted stock's "bid" and "ask" price information on pink paper. But keeping track of all of these pink sheets can be a real hassle. |
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| The difficulty in acquiring information about these unlisted stocks
is why Walker's Manual of Unlisted Stocks can be such a valuable resource.
This 608 page hardcover volume, now in its 2nd edition, includes financial
and other information on 502 unlisted companies. 223 of which have been
added since the 1st edition which was published in 1996.
Retired CPA Harry Eisenberg, publisher of Walker's Manual of Unlisted Stocks, has gone to great lengths to secure information about unlisted stocks. From one account, he had to buy a share of Rand McNally stock for $400 before any information about the company would be released to him.[note 1] He evidently did not have to shell out the $125,000 needed to purchase a share of Kohler Co., the plumbing fixtures and supplies giant also profiled in this work. Many of the companies tracked through the pink sheet system are what are known as penny stocks. These stocks trade for mere pennies and are often known for their rather volatile value. Eisenberg concentrates on those companies that are well run and have a profitable track record.[note 2] |
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| This book is promoted as an investment guide, but the publisher denies any endorsement for investing in the companies included. The publishing company does disclose that some of its principals do have ownership positions in the profiled companies, but that "in all cases the principals' combined investment represents less than 1 percent of the outstanding shares" (p. xvi). | |
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| Companies are listed in alphabetical order by the company's name. Each
company has a one-page profile. The top of each profile indicates the
company's official address, telephone number, and fax number. There is
a brief company description section that describes the major activities
of the company and perhaps a little history. The bulk of the page is devoted
to listing up to 4 years of financial information in the following categories:
per share information, annual operating results, annual balance sheets,
and ratios.
The "per share information" includes the stock price at the end of the year (or otherwise noted time period), the earnings per share, the price/earnings ratio, the book value per share, the price/book value percentage, and the dividends per share. The "annual operating results" data include the following elements: total revenues, costs and expenses, income before taxes, income taxes, net income, and cash flow from operations. There is also another category in the operations category entitled "other items" which, if significant, are discussed in the comments section on the page. The annual balance sheet figures are those normally included in such a category: cash and equivalents, local current assets, net fixed assets, total assets, total current liabilities, long-term debt, and stockholders' equity. The ratios are listed in a category entitled "Performance & Financial Conditions." These ratios calculated are the return on total revenues, the return on average stockholders' equity, the return on average assets, the current ratio, and the debt/equity ratio. Each profile includes a "Comments" section where financial figures are explained or trends recognized. The major officers are listed along with the number of employees. The company's SIC Code is identified. The number of outstanding shares and the number of shareholders are noted along with the total market value of the company's capitalization. The frequency of dividends is also given, where applicable. The final section of each profile identifies the exchange where the company's stock is listed when it does trade and the company ticker symbol is provided. If stock may be acquired only by order matching, this is also noted. The company's stock transfer agent and auditor are identified. Up to two market makers are mentioned and their telephone numbers are provided. Often the name of a broker dealer known to specialize in that stock is provided along with the specialist's affiliation and telephone number. There are 110 banks profiled in this manual, representing over one-fifth of the total number of companies reported. Banks report a slightly different set of financial figures. Some of these include non-interest income and non-interest expense lines under annual operating results, and ratios indicating the net interest margin as well as the bank's reserve as a percentage of its problem loans. The publisher, Harry Eisenberg, also publishes Walker's Manual of Community Bank Stocks (1st ed., $100.00; ISBN 0-9652088-7-7) which includes profiles of 502 banks. A very detailed accounting of the contents of each profile is given on pages xviii through xxi in the book's introduction. Separate sets of pages explain the additional data elements for the bank profiles. These introductory pages also include a helpful glossary of terms used in the "per share information" and "annual financial data" sections of each profile. |
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| There are several indices. The first index simply lists the companies
in alphabetical order with an asterisk marking all the companies that
have been added since the first edition. There is a geographic index that
lists the companies alphabetically by state. It is followed by an SIC
Code index which lists them under the following 11 broad SIC Code categories:
Agriculture, Forestry & Fishing Other indices list the companies by total revenue, by market capitalization, by return on average equity, by price/earnings ratio, price/book value, compound revenue growth, and compound EPS growth. The final index lists the companies in alphabetical order by investment classification (value, growth, income, and speculative). The last page in the book is a listing of the Internet addresses for the home pages of 41 of the companies profiled in the manual. Why the home page addresses are not listed on the company's profile page is a mystery. Of the companies listed in the 1st edition, twenty-nine are now listed on a major exchange or NASDAQ. Also, of the companies listed in the 1st edition, other companies acquired sixteen. These 45 companies are therefore not included in the 2nd edition. The introduction to the 2nd edition also mentions that foreign stocks and tax-shelter partnerships had been included in the 1st edition but, due to comments from the manual's users, were removed. |
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| This 2nd edition includes what the publisher calls "historical
vignettes" for 14 companies. Vignettes are included for the following
companies.
Crowley Maritime These vignettes are single page accounts of events in the company's history. They are interesting stories, but add little to contemporary analysis of the company. For example, the vignette accompanying the York Water Company entry deals with the 1816 threat of fire that lead to the founding of the company. 1840 advances in water pumping technology, and the 1891 typhoid epidemic's impact on drinking water safety. Only two sentences deal with the twentieth century. |
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| Walker's Manual of Unlisted Stocks has, as John Cunniff of the Associated Press put it, "re-established the Walker name as a source of investment information."[note 3] Standard business directories do not include much information, if any at all, on companies such as those profiled here. The layout of the information is very easy to understand with appropriate use of typefaces and white space. For the amount of information included and the understandable difficulty with which it was gathered, the price is quite reasonable. It is a worthy addition to any business reference collection. | |
| Brent Alan Mai Assistant Professor of Library Science Management & Economics Library Purdue University West Lafayette, IN mai@mgmt.purdue.edu |
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| 1. Rhonda Brammer, "Unlisted Numbers, " Barron's
(26 August 1996): 17.
2. Christopher Simeral, "The Hidden Stock Market," Your Money (October/November 1997): 63. 3. John Cunniff, "A Little Digging Will Uncover Hidden Stock Gems," Connecticut Post (3 August 1997): 16. |
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Mai, Brent Alan. 1998. Review of Walker's Manual of Unlisted Stocks. Journal of Business & Finance Librarianship, Volume 3, Issue 4: 82-87. |