Wealthiest Arkansans: Stephenses Hang on Behind Waltons Despite Tough Year

During a year in which almost all Arkansans’ lives changed, whether profoundly or imperceptibly, one of the state’s great mercantile clans soldiered on.

The Stephens family of Little Rock saw almost a third of the value of its publicly traded stock holdings disappear since mid-2000, when Arkansas Business last tracked the state’s wealthiest. Still, the family managed to hang on to second place in Arkansas Business’ 2001 Wealthiest Arkansans list.

(Also, see our list of Arkansans’ Major Stock Holdings in Public Companies. Click here for the first of our 10 profiles of the state’s wealthiest families.)

Helen Walton, widow of Wal-Mart Stores Inc. founder Sam Walton, and their four children remained unchallenged for the No. 1 spot, despite losing 16 percent from the value of its holdings. Two former Wal-Mart executives, Don Soderquist and Jack Shewmaker, moved into the top 10 in holdings on the strength of their stock in the Bentonville chain, while former Wal-Mart CEO David Glass, now owner of the Kansas City Royals baseball club, dropped from 10th place to No. 12 in stock holdings.

Two members of the wealthiest club passed away in 2001. Frank L. Coffman Jr., former CEO of First Federal Bancshares of Arkansas Inc. in Harrison, died in May. Coffman’s family ranks 52nd on the list of stockholders. And Herbert H. McAdams II, who rode a string of bank consolidations to a No. 8 ranking in the 2001 list, died last week at 86.

The only individual to make the wealthiest Top 10, Lt. Gov. Winthrop Paul Rockefeller, stayed at No. 3.

In the No. 4 spot was the family of Springdale poultry king Don Tyson, whose holdings — primarily in Tyson Foods Inc. — rose 10 percent in value after slumping badly during a glut in the chicken market. El Dorado’s Murphy family, key stockholders in Murphy Oil Corp., remained at No. 5 in a strong year for the energy company.

Media magnate Walter Hussman Jr.’s family again ranked as the sixth wealthiest in the state. Hussman owns and publishes the Arkansas Democrat-Gazette.

Ranked seventh was the family of Frank Lyon Jr., despite a 22 percent drop in holdings value, primarily invested in US Bancorp stock. Bella Vista’s John A. Cooper family dropped one slot to ninth, while the F.S. “Sheridan” Garrison family enjoyed a 61 percent increase in stock wealth and a leap from No. 25 to No. 9, thanks to the sale of American Freightways, the Harrison trucking company Garrison founded, to FedEx Corp. of Memphis.

Despite a 7 percent drop in holdings value, the J.B. Hunt family hung in at ninth place on the stock holdings list, down one from 2000. Hunt, of Lowell, owns a chunk of J.B. Hunt Transport Services Inc., the nation’s largest publicly traded truckload carrier.

The H.L. Hembree family of Fort Smith posted one of the largest gains in stock holdings for the year, a 107 percent increase on the strength of the sale of First American Corp. to AmSouth Bancorporation of Birmingham, Ala. Another Fort Smith investor, Robert A. Young III, CEO of Arkansas Best Corp., notched a 116 percent gain to jump from 34th to 16th in the 2001 rankings.

The Stephenses, owners of the Stephens Group Inc. that includes Stephens Inc., one of the largest investment firms located off Wall Street, encountered some particularly rough sledding. Power-One Inc., a California electronics-maker company that Stephens took public in 1997 and in which the family was heavily invested, fell from $71.50 a share in mid-2000 to $8.11 on Nov. 1 — a paper loss of $600 million.

And a major Stephens purchase, the Staffmark Inc. commercial staffing firm bought from Edgewater Technologies Inc. for $195 million in 2000, has also been a disappointment. Though not publicly traded and therefore not included in the stock holdings list, Staffmark is not performing up to standard, as evidenced by its new owners’ contention in a lawsuit filed in August that the staffing company’s expense structure is far more costly than they were led to believe.

Finally, the firm endured several days of messy public protest last month over its investment in and loans to a British company that tests pharmaceuticals on animals.

But after the overwhelming tragedy of Sept. 11, Stephens Inc. chief Warren Stephens sounded a note of reason and comfort in a memo to Stephens employees, and by extension the public, the Friday before the markets reopened.

“In a week filled with tragic and extraordinary scenes, next Monday will be another one,” Stephens wrote. “The equities markets have been closed for the longest stretch of business days in modern history.”

“Monday (and the rest of the week) will be tense and stressful,” Stephens concluded. “Put in perspective, this is not life or death. Be professional, courteous and humorous (when you can). At the end of the day, let’s be able to say we did a great job (not just good). If we do, then we’ve done our part to win this fight one day at a time. See you Monday.”

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