Note 6 - Marketable Securities

3 Months Ended

Mar. 31, 2013

Marketable Securities [Table Text Block]

6.   
Investments

Marketable Securities

The Company’s Investment Committee was directed by the Board to establish and implement an investment policy for the Company’s portfolio that meets the following general objectives: preserve principal; maximize total return given overall market conditions; meet internal liquidity requirements; and comply with applicable accounting, internal control and reporting requirements and standards. The Investment Committee is authorized, among other things, to invest its excess cash directly or allocate investments to outside managers for investment in equity or debt securities, provided that the Investment Committee may not invest more than $25 million in any single investment or with any single asset manager without the Board’s approval. The Company regularly reviews its investment portfolio to ensure adherence to the investment policy and to monitor individual investments for risk analysis and proper valuation.

The Company’s portfolio of marketable securities at March 31, 2013 was as follows:

	Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(in thousands)
Available-for-sale securities:
Short-term deposits	$	47,490		$	-	$	-		$	47,490
Mutual funds		10,368			2,724		-			13,092
United States government securities		78,346			131		-			78,477
Corporate securities		30,387			2,829		(686	)		32,530
Corporate obligations		54,373			1,029		(472	)		54,930
Commercial paper		21,541			5		-			21,546
Total available-for-sale securities		242,505			6,718		(1,158	)		248,065
Amounts classified as cash equivalents		(61,727	)		-		-			(61,727	)
Amounts classified as marketable securities	$	180,778		$	6,718	$	(1,158	)	$	186,338

The Company’s portfolio of marketable securities at December 31, 2012 was as follows:

	Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(in thousands)
Available-for-sale securities:
Short-term deposits	$	48,596		$	-	$	-		$	48,596
Mutual funds		10,368			1,452		-			11,820
United States government securities		99,299			178		-			99,477
Corporate securities		20,842			1,255		(1,980	)		20,117
Corporate obligations		48,708			283		(277	)		48,714
Commercial paper		22,275			16		-			22,291
Total available-for-sale securities		250,088			3,184		(2,257	)		251,015
Amounts classified as cash equivalents		(51,887	)		-		-			(51,887	)
Amounts classified as marketable securities	$	198,201		$	3,184	$	(2,257	)	$	199,128

Sales of marketable securities resulted in gross realized gains of $1.3 million and $0.1 million for the three-month periods ended March 31, 2013 and 2012, respectively. Sales of marketable securities resulted in immaterial gross realized losses in both three-month periods ended March 31, 2013 and 2012.

The following table summarizes the fair value and gross unrealized losses of the Company’s available-for-sale marketable securities, aggregated by type of investment instrument and length of maturity for individual securities that were in an unrealized loss position at March 31, 2013:

	Less than 12 Months				12 Months or Greater				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in thousands)
U.S. government securities	$	1,408	$	-	$	-	$	-	$	1,408	$	-
Corporate oligations		5,406		2		6,536		470		11,942		472
Total	$	6,814	$	2	$	6,536	$	470	$	13,350	$	472

The following table summarizes the fair value and gross unrealized losses of the Company’s available-for-sale marketable securities, aggregated by type of investment instrument and length of maturity for individual securities that were in an unrealized loss position at December 31, 2012:

	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
	(in thousands)
U.S. government securities	$	88,420	$	-		$	11,056	$	-		$	99,476	$	-
Corporate oligations		24,346		(2	)		24,370		(272	)		48,716		(274	)
Total	$	112,766	$	(2	)	$	35,426	$	(272	)	$	148,192	$	(274	)

The Company’s investment portfolio consists of both corporate and government securities that generally mature within three years. The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. As yields increase, those securities purchased with a lower yield-at-cost show a mark-to-market unrealized loss. All unrealized losses are due to changes in interest rates and bond yields. The Company has considered all available evidence and determined that the marketable securities in which unrealized losses were recorded in the three-month periods ended March 31, 2013 and 2012 were deemed to be temporary. The Company holds its marketable securities as available-for-sale and marks them to market through a corresponding adjustment to other comprehensive income (loss) in stockholders’ equity. Classification of marketable securities as a current asset is based on the intended holding period and realizability of the asset.

The amortized cost and estimated fair value of investments in available-for-sale debt securities at March 31, 2013, by contractual maturity, were as follows:

	Cost		Estimated  Fair Value
	(in thousands)
Mature in one year or less	$	214,006	$	219,000
Mature after one year through three years		7,998		8,415
Mature in more than three years		20,501		20,650
Total	$	242,505	$	248,065

Equity Investments

In January 2013, the Company acquired a 40% membership interest in a fitness equipment company for a cash price of $4.0 million. This investment is being accounted for as an associated company using the equity method as the Company owns less than 50% and does not have control of its operations.