Rare Book Monthly

Articles - September - 2011 Issue

It's Been a Tough Month for Large Book Retailers


Borders bids its final farewell.

This has not been a good month for large, chain bookstores, especially so for their investors. Physical retailing has been battling online selling for a decade, and physical books have been battling electronic ones for the past two years. Neither has fared well. Both will survive for many years to come, but will continue to lose market share to their electronic counterparts. It makes for a difficult business, and tough investment.


A little over a month ago, the number one bricks and mortar book retailer, Barnes and Noble, its stock long in the doldrums, received some good news. Liberty Media, noted for buying up troubled companies, made an offer of $17 per share. Now this may not seem exciting for a company whose share price reached $45 five years ago, but it had spent most of the year under $15, and briefly hit an all-time low under $10. However, Liberty was less interested in its stores than its Nook electronic reader, a surprising success after belatedly entering the market way after Amazon's Kindle. Kindle remains by far the leader, but the Nook has become a solid number two, garnering around a quarter of the market and growing.


However, it appears that Liberty and Barnes and Noble could not agree on the value of the Nook, so Liberty withdrew its takeover bid and instead purchased $204 million worth of B&N preferred stock. It pays a hefty 7.75% dividend and can be converted into a 16.6% share of the company. This provides the company with welcome cash, but the dividend rate it must pay is high, and a conversion of the preferred stock to common will result in shareholder dilution. The investment may be good for the company, but not so good for shareholders. The stock price quickly dropped to $10, and recently was trading for $11. That $17 offer doesn't look so bad now.


For the number two physical retailer of books, there is really no more to say. In February, Borders filed for bankruptcy protection, and in July announced that no buyer for the chain could be found. Instead, it would close all of its stores and liquidate its assets. That liquidation should be completed by the end of this month, bringing a final end to Borders' 40-year career. You may find some bargains in the next few days at your local Borders store as discounts are large, but what is likely to be left now are the dregs. You can also find Borders stock at a cheap price. It has ranged between 2 and 4 cents a share the past few weeks. At its peak it cost $37. Don't waste your money. It isn't worth 2 cents. Eventually, it will settle at zero.


The third largest bricks and mortar book retailer in America, soon to be number two, is attempting to pick up some sales from the Borders bankruptcy. Books-A-Million, the southern-based bookstore chain, attempted to purchase the leases, fixtures, and inventory of 30 defunct Borders locations. The two could not reach a deal, but Books-A-Million will be taking over the leases of 14 closing Borders locations. BAM (as Books-A-Million is also known) is looking to expand its footprint north. Stores in Maine, New Hampshire, Connecticut, Maryland, New Jersey, Illinois, Wisconsin, Michigan, Pennsylvania and Ohio are reportedly among those sought to be taken over.


While Books-A-Million has been swimming against the tide by actually expanding its physical presence, it still has not been an easy time for the growing chain. The firm recently reported a $2.9 million loss for the second quarter, compared to a $1.9 million gain for the same quarter in the previous year. Its recent stock price, below $2.50, is approaching historic lows. That's about one-quarter of its price of 20 years ago, not a great long-term investment. The troubling results showed an 11.4% decline in overall revenue and a 12.9% decline in sales at same stores year over year. CEO Clyde Anderson stated, "A soft publishing lineup, the effect of e-book migration and the impact of Border's liquidation all contributed to the decline in comparable-store sales."


However, there remains one positive book investment story - Amazon.com. The largest online bookseller, and leader in the electronic book field, continues to trade around the $200 per share level, near its record high price reached earlier this year. Indeed, if you bought Borders stock for $37 in 1998, you could have purchased Amazon for half that price. Now Amazon stock is worth $200 and Borders 2 cents. The challenge for investors today is to figure out which companies are the next Amazon, and which are the next… Borders.

Rare Book Monthly

  • <b>Bonhams: Fine Books and Manuscripts. March 9, 2018</b>
    <b>Bonhams, Mar. 9:</b> BEETHOVEN, LUDWIG VAN. Autograph Manuscript sketch-leaf part of the score of the Scottish Songs, "Sunset" Op. 108 no 2. [Vienna, February 1818]. Inscribed by Alexander Wheelock Thayer. $80,000 to $120,000
    <b>Bonhams, Mar. 9:</b> Violin belonging to Albert Einstein, presented to him by Oscar H. Steger, 1933. $100,000 to $150,000
    <b>Bonhams, Mar. 9:</b> EINSTEIN, ALBERT. Autograph Letter Signed ("Papa") to his son Hans Albert, discussing his involvement with the atomic bomb, September 2, 1945. $100,000 to $150,000
    <b>Bonhams: Fine Books and Manuscripts. March 9, 2018</b>
    <b>Bonhams, Mar. 9:</b> HAMILTON, ALEXANDER. Autograph Letter Signed, to Baron von Steuben, with extensive notes of Von Steuben's aide Benjamin Walker, June 12, 1780. $10,000 to $15,000
    <b>Bonhams, Mar. 9:</b> NEWTON, ISAAC. Autograph Manuscript in Latin, being detailed instructions on making the philosopher's stone. 8 pp. 1790s. $200,000 to 300,000
    <b>Bonhams, Mar. 9:</b> 1869 Inauguration Bible of President Ulysses S. Grant. $80,000 to $120,000
  • <b>19th Century Shop:</b> Charles Darwin on sexuality and the transmission of hereditary characteristics: Autograph Letter Signed to Lawson Tait. Down, 17 January [1877].
    <b>19th Century Shop:</b> MILTON, JOHN. <i>Paradise Lost. A Poem written in ten books.</i> London: 1667. A very rare example with the contemporary binding untouched and with a 1667 title page.
    <b>19th Century Shop:</b> Hamilton secures the ratification of the Constitution: <i>The Debates and Proceedings of the Convention of the State of New-York, assembled at Poughkeespsie, on the 17th June, 1788.</i>
    <b>19th Century Shop:</b> The social contract “Man is born free, and everywhere he is in chains”: ROUSSEAU, JEAN-JACQUES. <i>Principes du Droit Politique [Du Contract Social]</i>. Amsterdam: Michel Rey, 1762
    <b>19th Century Shop:</b> “The first English textbook on geometrical land-measurement and surveying”: BENESE, RICHARD. <i>This Boke Sheweth the Maner of Measurynge All Maner of Lande…</i>
  • <b>Forum Auctions: Fine Books, Manuscripts and Works on Paper. March 22, 2018</b>
    <b>Forum Auctions, Mar. 22:</b> Jenner (Rev. George Charles). <i>The Evidence at Large...Respecting Dr Jenner's Discovery of Vaccine Inoculation,</i> presentation copy from Edward Jenner to Rev. Rowland Hill, 1805. £4,000 to £6,000
    <b>Forum Auctions, Mar. 22:</b> Houdini (Harry).- Maggi (Girolamo). <i>De tintinnabulis liber postumus...de equuleo liber,</i> Harry Houdini's copy, Amsterdam, H. Wetstein, 1689. £600 to £800
    <b>Forum Auctions, Mar. 22:</b> Meyer (Henry Leonard). Coloured Illustrations of British Birds, and their Eggs , 7 vol. in 2 plus Illustrations of British Birds, 4 vol., 1842-50 and [1835-51]. £5,000 to £7,000
    <b>Forum Auctions: Fine Books, Manuscripts and Works on Paper. March 22, 2018</b>
    <b>Forum Auctions, Mar. 22:</b> Dickens (Charles). <i>An Entirely New Romantic Drama, in Three Acts, by Mr. Wilkie Collins, called The Frozen Deep,</i> 1857. £3,000 to £4,000
    <b>Forum Auctions, Mar. 22:</b> Lighthouses and Islands of Ireland, c. 125 drawings, 1867. £6,000 to £8,000
    <b>Forum Auctions, Mar. 22:</b> Shelley (Lady Jane). Diary, 1853 & 1860. £1,500 to £2,000
    <b>Forum Auctions: Fine Books, Manuscripts and Works on Paper. March 22, 2018</b>
    <b>Forum Auctions, Mar. 22:</b> Scottish Binding.- The Holy Bible, Containing the Old and New Testaments, bound in contemporary brown polished calf decorated with the figure of a Chinese spearman, by ?James Scott of Edinburgh, 1778. £2,000 to £3,000
    <b>Forum Auctions, Mar. 22:</b> Greene (Graham). <i>The Man Within,</i> first edition, signed by the author, 1929. £4,000 to £6,000
    <b>Forum Auctions, Mar. 22:</b> Mellan (Claude, 1598-1688). The Holy Face, or the Veil of St Veronica, [c. 1649 and later]. £800 to £1,200
    <b>Forum Auctions: Fine Books, Manuscripts and Works on Paper. March 22, 2018</b>
    <b>Forum Auctions, Mar. 22:</b> Desaguliers (John Theophilus). <i>A Dissertation concerning Electricity,</i> W. Innys, and T. Longman, 1742. £2,000 to £3,000
    <b>Forum Auctions, Mar. 22:</b> Le Jeune (Paul). <i>Relation de se qui s'est passé en la Nouvelle France en l'anné 1636 enuoyée au R.Pere Provincial de la Compagnie de Iesus en la Province de France,</i> 1637. £2,000 to £3,000
    <b>Forum Auctions, Mar. 22:</b> Stumpf (Johann Rudolph). <i>Gemeiner loblicher Eydgnoschafft Stetten, Landen und Völckern Chronicwirdiger thaaten beschreibung, </i> Zurich, Froschauer, 1586. £3,000 to £4,000
  • <b>Swann Auction Galleries Mar 29: Printed & Manuscript African Americana</b>
    <b>Swann Auction Galleries Mar 29:</b> Malcolm X, Autograph Letter Signed, from prison, 1950. $20,000 to $30,000.
    <b>Swann Auction Galleries Mar 29:</b> Letter from Moses Walker, an enslaved Georgia man, to his mother at another plantation, 1854. $12,000 to $18,000.
    <b>Swann Auction Galleries Mar 29:</b> Signed cabinet card of Frederick Douglass, albumen photograph, Boston, circa 1879. $10,000 to $15,000.
    <b>Swann Auction Galleries Mar 29: Printed & Manuscript African Americana</b>
    <b>Swann Auction Galleries Mar 29:</b> Placard from the Memphis Sanitation Worker's strike, 1968. $10,000 to $15,000.
    <b>Swann Auction Galleries Mar 29:</b><br><i>The North Star,</i> volume 1, issue 27, Rochester, NY, 1848. $8,000 to $12,000.
    <b>Swann Auction Galleries Mar 29:</b> Hand-tinted tintype of John Brown, circa 1860. $4,000 to $6,000.
    <b>Swann Auction Galleries Mar 29: Printed & Manuscript African Americana</b>
    <b>Swann Auction Galleries Mar 29:</b> Poster signed & inscribed by Huey Newton, circa 1967. $4,000 to $6,000.
    <b>Swann Auction Galleries Mar 29:</b> Album of aerial views of the march on Montgomery, taken by federal troops, 1965. $3,000 to $4,000.
    <b>Swann Auction Galleries Mar 29:</b> Poster for the SNCC, photograph by Danny Lyon featuring John Lewis, circa 1962. $3,000 to $4,000.

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