Investments

3 Months Ended

Mar. 31, 2021

Investments Debt And Equity Securities [Abstract]

Investments

7. INVESTMENTS

Debt Securities and Other Investments

The following debt securities and other investments were included on the Condensed Consolidated Balance Sheets and recorded at fair value:

	As of  March 31,2021
	Amortized		Gross Unrealized					Fair
(In thousands)	Cost		Gains		Losses			Value
Corporate bonds	$	14,176	$	68	$	(13	)	$	14,231
Municipal fixed-rate bonds		2,600		25		—			2,625
Asset-backed bonds		5,772		42		(2	)		5,812
Mortgage/Agency-backed bonds		11,775		92		(22	)		11,845
U.S. government bonds		9,704		66		(1	)		9,769
Foreign government bonds		1,331		3		(2	)		1,332
Other		533		—		—			533
Available-for-sale debt securities held at fair value	$	45,891	$	296	$	(40	)	$	46,147

	As of December 31, 2020
	Amortized		Gross Unrealized					Fair
(In thousands)	Cost		Gains		Losses			Value
Corporate bonds	$	11,762	$	123	$	—		$	11,885
Municipal fixed-rate bonds		2,854		30		—			2,884
Asset-backed bonds		6,634		74		—			6,708
Mortgage/Agency-backed bonds		11,536		114		(6	)		11,644
U.S. government bonds		9,763		112		—			9,875
Foreign government bonds		1,334		4		(1	)		1,337
Commercial Paper		250		—		—			250
Other		533		—		—			533
Available-for-sale debt securities held at fair value	$	44,666	$	457	$	(7	)	$	45,116

The contractual maturities related to debt securities and other investments were as follows:

	As of  March 31,2021
(In thousands)	Corporate bonds		Municipal fixed-rate bonds		Asset- backed bonds		Mortgage / Agency- backed bonds		U.S. government bonds		Foreign government bonds		Other
Less than one year	$	1,323	$	357	$	16	$	296	$	1,282	$	75	$	533
One to two years		3,758		1,130		13		2,090		6,831		460		—
Two to three years		7,509		1,138		272		1,740		1,656		497		—
Three to five years		1,641		—		3,445		175		—		300		—
Five to ten years		—		—		1,143		2,457		—		—		—
More than ten years		—		—		923		5,087		—		—		—
Total	$	14,231	$	2,625	$	5,812	$	11,845	$	9,769	$	1,332	$	533

Actual maturities may differ from contractual maturities as some borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

Realized gains and losses on sales of debt securities are computed under the specific identification method. The following table presents gross realized gains and losses related to debt securities:

	Three Months Ended
	March 31,
(In thousands)	2021			2020
Gross realized gains on debt securities	$	87		$	43
Gross realized losses on debt securities		(16	)		(20	)
Total gain recognized, net	$	71		$	23

The Company’s investment policy provides limitations for issuer concentration, which limits, at the time of purchase, the concentration in any one issuer to 5% of the market value of the total investment portfolio. The Company did not purchase any available-for-sale debt security with credit deterioration during the three months ended March 31, 2021.

Marketable Equity Securities

Our marketable equity securities consist of publicly traded stock, funds and certain other investments measured at fair value or cost (where appropriate).

In March 2019, an outstanding note receivable of $4.3 million was repaid and reissued to the Company in the form of debt and equity. Of the outstanding $4.3 million, $3.4 million was issued as an equity investment. The Company elected to record this equity investment that does not have a readily determinable fair value using the measurement alternative. Under the measurement alternative, equity investments that do not have a readily determinable fair value can be recorded at cost less impairment, if any, adjusted for observable price changes for an identical or similar investment. During the year ended December 31, 2020, impairment charges totaling $2.6 million were recorded related to this equity investment, which was included in net investment gain (loss) on the Condensed Consolidated Statement of Income (Loss). As a result, the carrying value of this investment was $0.8 million as of March 31, 2021 and December 31, 2020. The remaining amount, $0.9 million of the original $4.3 million note receivable, was reissued as a new note receivable, which is included in long-term investments on the Condensed Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020. No impairment charge was recognized related to the note receivable, as it is a secured loan. 

Realized and unrealized gains and losses related to marketable equity securities were as follows:

	Three Months Ended
	March 31,
(In thousands)	2021		2020
Realized gains (losses) on equity securities sold	$	24	$	(2,436	)
Unrealized gains (losses) on equity securities held		901		(8,464	)
Total gain (loss) recognized, net	$	925	$	(10,900	)

U.S. GAAP establishes a three-level valuation hierarchy based upon observable and unobservable inputs for fair value measurement of financial instruments:

• Level 1 – Observable outputs; values based on unadjusted quoted prices for identical assets or liabilities in an active market;

• Level 2 – Significant inputs that are observable; values based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly;

• Level 3 – Significant unobservable inputs; values based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement; inputs could include information supplied by investees.

The Company’s cash equivalents and investments held at fair value are categorized into this hierarchy as follows:

			Fair Value Measurements as of March 31, 2021 Using
(In thousands)	Fair Value		Quoted Prices in Active Market for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents
Money market funds	$	889	$	889	$	—	$	—
Available-for-sale debt securities
Corporate bonds		14,231		—		14,231		—
Municipal fixed-rate bonds		2,625		—		2,625		—
Asset-backed bonds		5,812		—		5,812		—
Mortgage/Agency-backed bonds		11,845		—		11,845		—
U.S. government bonds		9,769		9,769		—		—
Foreign government bonds		1,332		—		1,332		—
Other		533		—		—		533
Marketable equity securities
Marketable equity securities – various industries		11,544		11,544		—		—
Deferred compensation plan assets		24,364		24,364		—		—
Other investments		1,400		1,400		—		—
Total	$	84,344	$	47,966	$	35,845	$	533

			Fair Value Measurements as of December 31, 2020 Using
(In thousands)	Fair Value		Quoted Prices in Active Market for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents
Money market funds	$	497	$	497	$	—	$	—
U.S. government bonds		350		350		—		—
Available-for-sale debt securities
Corporate bonds		11,885		—		11,885		—
Municipal fixed-rate bonds		2,884		—		2,884		—
Asset-backed bonds		6,708		—		6,708		—
Mortgage/Agency-backed bonds		11,644		—		11,644		—
U.S. government bonds		9,875		9,875		—		—
Foreign government bonds		1,337		—		1,337		—
Commercial paper		250		—		250		—
Other		533		—		—		533
Marketable equity securities
Marketable equity securities – various industries		10,963		10,963		—		—
Deferred compensation plan assets		23,891		23,891		—		—
Other investments		1,400		1,400		—		—
Total	$	82,217	$	46,976	$	34,708	$	533

The fair value of our Level 2 securities is calculated using a weighted average market price for each security. Market prices are obtained from a variety of industry standard data providers, large financial institutions and other third-party sources. These multiple market prices are used as inputs into a distribution-curve-based algorithm to determine the daily market value of each security.  

The fair value of Level 3 securities is calculated based on unobservable inputs. Quantitative information with respect to unobservable inputs consists of third-party valuations performed in accordance with ASC 820 – Fair Value Measurement. Inputs used in preparing the third-party valuation included the following assumptions, among others: estimated discount rates and fair market yields.