UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-K

                ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

For the Year Ended
February 28, 1998                       Commission File Number:  291525-NY
-----------------                       ----------------------------------


                                MARKET GUIDE INC.

New York                                     11-2646081
(State or other jurisdiction of              (IRS Employer Identification No.)
incorporation or organization)             

     2001 Marcus Avenue, Suite South 200, Lake Success, New York 11042-1011
                    (Address of Principal Executive Offices)

                                 (516) 327-2400
              (Registrant's Telephone Number, Including Area Code)

                                      None
          (Securities Registered Pursuant to Section 12(b) of the Act)

                         Common Shares - $.001 Par Value
          (Securities Registered Pursuant to Section 12(g) of the Act)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                Yes X No _______

As of May 15,  1998,  the  aggregate  market  value of the voting  stock held by
non-affiliates,   2,555,899  shares  of  Common  Stock,  $.001  par  value,  was
$24,281,041 based on the closing price of $9.50 for one share of Common Stock on
such date.

The number of shares  outstanding  of the issuer's  Common Stock,  as of May 15,
1998 was 4,748,594.


<PAGE>


                                     PART I

Item 1:  Business

Business

Market Guide Inc. was incorporated in the State of New York on March 23, 1983 as
"The  Unlisted  Market  Service  Corporation."  On September 3, 1986 the current
corporate  name  was  adopted.  In 1996,  the  Company  formed  a new  division,
CreditRisk Monitor, to develop services for the corporate credit manager.

The Company acquires, integrates,  condenses and publishes accurate, timely, and
objective financial and other information on publicly traded  corporations,  and
markets this information to the financial, investment and credit communities, as
well as to independent investors through the Internet  (www.marketguide.com) and
other distribution channels in a cost effective manner.

The Market Guide  Database  covers over 9,200  companies  traded on the New York
Stock  Exchange,  American Stock  Exchange,  Nasdaq and  Over-the-Counter  Stock
Markets,  including  foreign companies trading in the U.S. as ADRs and ADSs. The
content created by Market Guide is derived from information filed by the subject
company with the Securities and Exchange Commission, issued in press releases or
carried in other media reports.  Each company's  information is updated at least
four and often more than eight  times a year,  as soon as  relevant  information
becomes available.  Pricing and trading volume information incorporated into the
database are updated daily, and short interest statistics are updated monthly.

Market Guide adds value,  distinguishes itself from the competition,  and serves
its clients through its:

         Flexible  database  design  which gives users  important  insights  not
         available  in  competitive  databases,  thereby  enabling  them to make
         better informed investment decisions;

         Inclusion of auxiliary  information such as earnings  estimates,  price
         performance,   relative   price   performance,   summary   insider  and
         institutional  ownership  statistics,  bond ratings, and short interest
         statistics giving users a complete perspective on each company;

         Calculation of over 500 popular  financial  ratios,  growth rates,  and
         averages computed for the user's convenience; and

         Carefully planned, market tested display formats,  including company to
         industry comparisons,  that allow users to quickly and efficiently make
         carefully considered investment and credit decisions.

         Developing efficient,  timely,  cost-effective and easy to use software
         delivery  systems such as Market Guide for Windows,  our Internet  site
         (www.marketguide.com)     and    the     CreditRisk     Monitor    site
         (www.creditriskmonitor.com).

The  targeted  markets  for Market  Guide's  data and related  products  include
investment  managers,  investment  research  departments,   financial  planners,
investment  counselors,  investment bankers,  banks,  stockbrokers and brokerage
firms, traders, libraries, publications,  corporations, law firms and individual
investors. The Company sells its information through four channels:  information
vendors,  the  Internet,  Market  Guide for Windows  (its  proprietary  analytic
software) and a print  publication.  The CreditRisk  Monitor division serves the
need of corporate credit managers through an Internet based service.


<PAGE>



Vendors

Market Guide works in partnership  with financial  information  service vendors.
The financial  information  service vendors combine data from various  real-time
and  historical  information  sources with their own analytic  software and data
delivery  capability.  Their sales forces sell the product and they also provide
customer training and support  services.  Market Guide focuses on developing the
highest quality information content and leveraging off the information  vendor's
sales force,  software,  information  dissemination  infrastructure and customer
base.  The amount of data  presented,  its display  format,  and the  software's
analytic  capabilities  vary  depending upon the way each  information  provider
defines its customers' needs, software capabilities,  distribution  technologies
and preferred pricing strategies.

Information service vendors that currently  distribute the Market Guide Database
include:   Accutrade;   America  Online;   American  Association  of  Individual
Investors;  Ameritrade;  Argus Research; Automatic Data Processing; AIQ Systems,
Inc.; Bridge Information  Systems Inc.;  Business Wire, Inc.; Charles Schwab and
Company; Charter Media; Data Broadcasting Corporation;  Dow Jones Markets; First
Call Corporation; Global Market Information; Holt Value Associates;  Horsesmouth
LLC; ILX Systems Inc.;  Individual  Investor  Group;  InfoSpace  Inc.;  Instinet
Analytics;  Interactive Data Corporation;  Internet Securities, LLC; Lycos; News
Alert, Inc; OneSource Information  Services,  Inc.; P.C. Quote, Inc.; Pointcast;
Prodigy Services Company;  Quotes Plus; Quotron Systems, Inc.; Real Time Quotes,
Inc.;  Reality  Online;   Reuters  PLC;   Securities  Data  Corporation;   Shark
Information  Services,  Inc.;  Siebel  Systems,  Inc.;  Telemet  America,  Inc.;
Telescan,  Inc.;  Track Data  Corporation;  Vickers Stock Research  Corporation;
Waterhouse Securities, Inc.; Windows on Wall Street; and Yahoo!.

In April 1998, Market Guide's  information was introduced on America Online, and
in May 1998, on Alta Vista.

Business Developments

In August 1995, the Company announced an agreement with the American Association
of Individual  Investors  (AAII)  whereby AAII will  incorporate  Market Guide's
information in their existing screening  software known as Stock Investor.  AAII
is an educational not for profit  corporation with over 100,000 members, a small
percentage of whom subscribe to Stock Investor. Market Guide's information first
appeared with Stock Investor's regular quarterly update in November 1995.

Market Guide's analytic  software  package,  Market Guide for Windows (MGW), was
introduced  in fiscal  year  1996.  This  product  permits  users to search  the
database,  develop user  defined  reports and  download  information  to popular
spreadsheet software packages. The software is not patented or trademarked,  but
a copyright is claimed by the Company.  Market Guide for Windows is delivered on
a CD/ROM with weekly or monthly updates.

In June 1996, the Company  announced a multi-year  contract with Reuters Limited
which grants Reuters'  worldwide use of Market Guide's  financial  database.  To
date,  this agreement  represents the largest single  contract in Market Guide's
history.

The  Company has an Internet  site that has been in  operation  since the second
quarter  of fiscal  1997.  It is  anticipated  that this site will  broaden  the
Company's  ability to sell and service its products  directly to end users.  The
address to our site is  http://www.marketguide.com.  The  Company  also uses its
Internet infrastructure to host co-branded sites and to work in partnership with
various  vendors.  In addition to  distributing  the  information  through  many
Internet based services,  Market Guide also hosts co-branded sites for brokerage
firms such as Ameritrade and Charles Schwab, as well as search engines including
Yahoo!.

The same Market Guide for Windows  software  with a smaller  information  set is
sold over the Internet to individual investors under the name StockQuest.
StockQuest was introduced in August 1996.

Also in August  1996,  the Company  formed a new  division,  CreditRisk  Monitor
("CRM").  CRM is an  Internet-based  financial  information  and real-time  news
service targeted  towards the corporate  credit function.  After seven months of
development work, the CreditRisk Monitor service was successfully  introduced in
April 1997.

Publications

The  Company's  quarterly  print  product,  The Market  Guide - Select  Over the
Counter  Stock  Edition,  is a single  volume of 800  one-page  reports  on fast
growing,  profitable  over-the-counter companies. Each quarterly book features a
somewhat  different set of 800 companies.  The book also has a detailed  company
index listing 15 key statistics on each company in a tabular format.  This index
is very useful to investors searching for attractive investment opportunities.

Market Guide attempts to provide  continuity of coverage so that  subscribers to
the book can keep following  companies in which they have an interest.  However,
from time-to-time the companies  covered do change.  The most common reasons for
deletion of coverage are:

        The company has been acquired in a merger or a leveraged buyout;

        The company has not filed a financial  statement with the Securities and
        Exchange Commission for two or more reporting periods;

        The company has exhibited significant deterioration in its financial
        condition;

        The company has been deleted from the National  Association  of Security
        Dealers  Automatic  Quotation  System  (Nasdaq) and has fewer than three
        Market Makers;

        The company now trades on the New York or American Stock  Exchange,  and
        no longer qualifies for the OTC edition.

Companies  dropped from the book are replaced by companies which are selected by
using  proprietary  Market Guide selection  criteria.  The companies in the book
have regularly outperformed the Nasdaq composite.

Database Enhancements

The  Company  continuously  expands,  enhances  and  improves  the Market  Guide
Database  and  related  software   capabilities  based  in  part  upon  customer
suggestions and employee  feedback.  In 1988, the Company added the New York and
American  Stock  Exchange  companies to its then current  universe of Nasdaq and
"pink sheet" companies.

In 1990,  Market  Guide  decided to expand  the  database  to  include  complete
detailed  quarterly  financial  statements.  The Company  engaged in a series of
dialogues  with current or  potential  vendors and  customers  to determine  the
market potential,  to identify the Company's perceived strengths and weaknesses,
and  to  research  market  needs  and  the   appropriateness  of  the  Company's
methodologies  and objectives.  The results of this analysis were the commitment
of  resources  to more than  double  the  amount of  information  collected  and
maintained  on each subject  company.  In fiscal  years 1990,  1991 and 1992 the
Company added the Annual  Statement of Cash Flows and complete  Quarterly Income
Statements,  Balance Sheets and Statements of Cash Flows on all the companies in
the database.  This has allowed  Market Guide to serve new markets and to bid on
services for which Market Guide did not previously qualify.

In late 1993 the Company  began to track short  interest  information  published
monthly by U.S. stock exchanges and markets.

In early 1994 the Company began subscribing to and processing the Securities and
Exchange  Commission's  (SEC's) Electronic Data Gathering Analysis and Reporting
(EDGAR) service.  This permitted access to source documents (10-Ks, 10-Qs, etc.)
ten  days to two  weeks  earlier  than  in  previous  years.  Record  levels  of
timeliness for the Market Guide Database have subsequently been attained.

In the fall of 1994, Market Guide introduced  completely new industry and sector
classifications that reflect the current economy and are being incorporated into
all of Market Guide's products.

These industry and sector classifications will help investors:

Identify  which  industries  and  sectors are  outperforming  the market or have
fallen from favor; o Compare companies to a well-defined peer group;

Analyze and review  industry and sector  financial  and  investment
characteristics;

Properly  construct  portfolios to ensure adequate  diversification;  and

Make well reasoned asset allocation decisions.

In the fall of 1995, the Company completed  development of a historical  pricing
database to complement the financial  information  it has compiled.  The pricing
database contains both historical and current information for all issues trading
on the New York and  American  Stock  Exchanges,  the Nasdaq Stock  Market,  and
selected OTC Bulletin Board and Pink Sheet  Companies.  The Market Guide pricing
database contains Open, High, Low, Close and Volume information on a daily basis
beginning in 1983, with daily updates occurring each trading day.

In order to satisfy  institutional  investors'  needs for  extensive  historical
financial information,  Market Guide increased the number of years of historical
annual financial  statements in the Market Guide database.  With the culmination
of the "Big Ten" project,  Market Guide now has annual financial  statement data
going back to 1983 for most  companies on its database.  As a result of the "Big
Ten" project,  Market Guide is now able to compete for other  business  where at
least ten years of historical  data is required.  This  information is currently
being distributed within the OneSource US Equities product, the Market Guide for
Windows product, and through selected vendors.

In fiscal  year 1997,  the  Company  began  collecting  information  on Dividend
Reinvestment Plans (DRIPs).  The DRIP information Market Guide collects includes
restrictions,  fees,  discounts  and  company  contacts  on over 900 plans.  The
Company will continue to expand its DRIP database as more companies sponsor such
plans.

In fiscal year 1997,  the Company  incorporated  Senior  Debt  Ratings  into its
database.  The debt ratings offered on the Market Guide Database are provided by
Fitch Investors Service,  LP; Moody's Investors  Service;  and Standard & Poor's
Rating Group.  Ratings data includes  current  ratings,  prior ratings,  and the
accompanying  dates. Using these ratings,  Market Guide has constructed  average
company and industry ratings information.

Internet

The Company has created a dynamic,  comprehensive  and extremely useful Internet
site.  The site  contains  both  advertising  supported  and added cost content.
Advertising  supported  content is free to the user and Market Guide  expects to
cover  its  costs  and  generate  profits  from the sale of  advertising.  As of
February 1998, the advertising supported content included:

     Real time price quotes;

     News (in partnership with News Alert);

     Market Guide's Company Snapshot Reports;

     Market  Guide's  What's  Hot/What's  Not service that  identifies the price
     performing  leaders and  laggards  by sector,  industry  and  company  over
     various time periods; and

     Price charts (in partnership with Neural Applications Corp.)

For users who wish to have more comprehensive information, added cost content is
available  for nominal  per report or  subscription  based fees.  The added cost
content includes:

     The Market  Guide Quick Facts  Report;

     The Market Guide  Company  Profile Report;

     The Market  Guide  Ratio  Comparison  Report;

     The  Market  Guide Detailed  Financials;

     The Market Guide ProVestor Report;

     The Market Guide ProVestor Plus Report;

     The Earnings  Estimate Report (in partnership with First Call); and

     Market Guide StockQuest Screening Software and Reporting applications.

In addition to our own site,  Market  Guide's  information  is available on more
than 30 other web sites. Most of these web partners also offer their users added
cost services from Market Guide.  These added cost services are delivered mostly
through co-branded sites hosted by Market Guide.

CreditRisk Monitor

Market  Guide's  newest  division,  CreditRisk  Monitor  (CRM),  is a new online
information  and news  service that  follows  more than 375 U.S.  publicly  held
domestic  retail  chains and  wholesalers.  This  online  service is  accessible
through  the  Internet  (www.creditriskmonitor.com)  and has  been  designed  to
provide corporate credit managers with the analytical tools necessary to analyze
and follow, on a daily basis, all the public companies they do business with.

CRM was formed  specifically to leverage Market Guide's  comprehensive  database
and state-of-the-art  technology through sales to a new market. CRM provides the
credit community with a cost efficient,  online credit and financial information
service.

The CRM  information  service  consists of: CRM Company  Reports,  the CRM Alert
Notification Service and the CRM Real-Time News Service. The CRM web site became
operational in April 1997.

Business Facilities

In October 1994,  the Company  relocated its principal  place of business to new
headquarters  in Lake Success,  New York.  Lake Success is located on the Queens
(New York City) - Nassau  County (Long  Island)  border.  The Company  currently
maintains two office suites in this complex, Suite South 200 which totals 13,500
square feet, and Suite West 290 which totals 5,500 square feet.

In June 1996, the Company leased a sales office in Chicago, Illinois. This space
totals 572 square feet and is staffed by a full time sales representative.  This
office will be closed in May, 1998.

Reverse Stock Split

The Company instituted a one-for-four reverse stock split on October 16, 1995.

Competition

The investment and financial  information  industry is highly  competitive  with
many different firms serving the industry's needs.  There are numerous print and
electronic publishers of information for the investment community,  most of whom
have been in business  longer,  are better known and whose  financial  resources
exceed those of the Company.  Among the better known competitors are: Standard &
Poor's, Moody's, Value Line and Disclosure.

The Company believes that it is distinguished from much of the competition as it
compiles,  maintains,  and publishes one of the largest  databases of investment
quality information.  Market Guide also competes by providing database structure
and  content  that help users make  better  informed  decisions  and through the
effective use of technology that enables the Company to be a price leader.

One of the  most  significant  distinctions  is that  Market  Guide  stores  and
displays company financials in the same "company specific line item description"
format used by the subject  company in its SEC filings.  "Company  specific line
item  description"  means  that the line  item  terminology  assigned  to Income
Statement,  Balance  Sheet or  Statement of Cash Flow values is the same as that
used by the company in its official  report.  For example,  "Aircraft  Fuel" and
"Landing Fees" may be shown for an airline  company;  "Newsprint"  and "Postage"
for a newspaper  publisher.  This allows users to project the impact of external
events  such  as  changes  in  the  price  of  oil,  paper  or  postage  on  the
profitability of a company.  Competitive databases might consolidate these items
under general headings such as "Costs of Goods Sold."

The  principal  methods of  competition  between  the  companies  engaged in the
historical financial  information business are: accuracy of data;  timeliness of
database  updating;  size of the universe  presented;  depth of coverage of each
company in the universe; number of years of coverage; methods of delivery to the
end user;  the inclusion of analysis or opinion;  customer/vendor  support;  and
price.

Personnel

The Company currently has a staff of 86 full-time  employees,  down from 87 full
time personnel at the same time one year ago.

Year 2000 Compliance

The Company is  currently  conducting  a  comprehensive  review of its  computer
systems and software to assess its  exposure to Year 2000  issues.  Based upon a
preliminary assessment,  management believes the Company's systems are compliant
or will be compliant by the end of 1998. All maintenance and modification  costs
are being expensed as incurred.  The costs  associated with Year 2000 compliance
have not  been,  nor are  they  anticipated  to be,  material  to the  Company's
financial position or results of operations.


Item 2:  Properties

In October  1994,  the Company  moved its entire data  collection  operation and
management  offices to 2001 Marcus  Avenue,  Suite South 200, Lake Success,  New
York 11042-1011. The new space is approximately 13,500 square feet.

In November 1996, the Company leased an additional 5,500 square feet in the same
office  complex.  This space is being used  primarily  for  Market  Guide's  new
division, CreditRisk Monitor, and the programming department.

In management's opinion the layout,  design,  construction and furnishing of the
facility will support the growth of the Company.  The  telephone,  data network,
lighting and  electrical  support  systems  designed into the facility  create a
pleasant,  professional  and comfortable  environment in which our employees can
efficiently perform their tasks effectively.

The  productive  capacity  of the  facility  allows  for  the  expansion  of the
Company's data collection  capacities in a more rapid and efficient  manner,  as
well as to increase  the number of  companies  in the database and the amount of
information collected on each subject company.

The  facility  has  permitted  the  Company to acquire  the  services of several
additional  sales and marketing  personnel with space designated and furnishings
in place for additional  persons in the fields of marketing,  sales and customer
support.

The  facility  contains  specifically   constructed  spaces  for  the  Company's
extensive  computer and programming  activities.  Space exists for the expansion
and support of current and anticipated  on-line services,  vendor delivery,  and
Internet services.

In June 1996, the Company leased 572 square feet in Chicago, Illinois. The space
is being used as a sales office from which one dedicated  sales  professional is
managing selected existing vendors and generating new business. This office will
be closed in May, 1998.

Item 3:  Legal Proceedings

In December 1996, the Company commenced litigation in the United States District
Court for the Eastern  District of New York against  Information  Clearinghouse,
Inc. d/b/a F&D Reports (ICI) and Lawrence Sarf. The Company's  complaint alleges
claims of trademark infringement, unfair competition,  deceptive trade practices
and conversion in connection with the defendant's theft and use of the Company's
proprietary slogan,  "On-Line,  On-Time,  On-Target," developed for use with its
Internet based credit reporting service,  CreditRisk Monitor. Market Guide seeks
damages in an amount  exceeding  $5 million,  plus  injunctive  and  declaratory
relief.  ICI has filed an Answer  responding  to the  Complaint  and denying all
material  allegations.  Discovery  has been  completed  and ICI has indicated an
intention  to file a  pre-trial  motion on or before  June 9, 1998.  Pending the
determination of any such motion,  litigation counsel to the Company cannot give
assurance  as to the  relative  likelihood  of any  particular  outcome  in this
proceeding, and declines to do so.

ICI has  commenced a separate  action in state court  against  three  former ICI
employees,  Market Guide and individual  Market Guide employees arising from use
of alleged  trade secret  information.  ICI has  asserted  claims under New York
common law  seeking  injunctive  relief and  monetary  damages in the  estimated
amount of $4.3 million. The Company has denied all material allegations from the
outset of this suit, and the Company intends to continue its vigorous defense of
ICI's claims.  At the outset of the case,  ICI moved for  injunctive  relief and
Market Guide moved to dismiss all claims.  The Court  denied  ICI's  request for
injunctive  relief and the Company's motion.  Deposition  discovery is underway,
and is  scheduled  to be  completed  by July 7,  1998.  In view of the fact that
discovery  is ongoing,  outside  litigation  counsel to the Company  cannot give
assurance  as to the  relative  likelihood  of  any  particular  outcome  in the
proceeding and declines to do so.

Item 4:  Submission of Matters for a Vote of Security Holders

None.

Item 5:  Market for Registrant's Common Equity and Related Stockholder Matters

The Company's Common Stock was previously traded on the OTC Bulletin Board under
the symbol MARG for the 1997 fiscal year. Effective March 5, 1997, the Company's
stock commenced trading on the Nasdaq SmallCap Market under the symbol MARG. The
table below sets forth,  for the fiscal periods shown,  the high and low closing
prices for the Common Stock as reported by a brokerage firm active in the shares
of the Company's  Common Stock (as adjusted for the  one-for-four  reverse stock
split in October  1995).  On February 27, 1998,  the last reported sale price of
the Common Stock as reported on the Nasdaq SmallCap Market was 2 5/8 per share.

         Fiscal 1998                                 High              Low

         First Quarter                               4 3/8             2 1/4
         Second Quarter                              3 3/4             2 3/8
         Third Quarter                               3 1/2             1 3/4
         Fourth Quarter                              3 1/8             2 1/4


         Fiscal 1997                                 High              Low

         First Quarter                               5 3/32            3 1/4
         Second Quarter                              5 1/4             3 1/4
         Third Quarter                               4 1/8             2 3/4
         Fourth Quarter                              4 3/4             2 7/8

On February 28, 1998 there were 450 holders of record of the Common Stock of the
Company.  The Company estimates the number of beneficial owners of the Company's
Common Stock on February 28, 1998 to be approximately 800.

The Company has never paid a cash  dividend  on its Common  Stock.  The Board of
Directors  currently  intends to retain all earnings to finance the expansion of
the  Company's  business and does not  anticipate  paying cash  dividends in the
foreseeable future.


<PAGE>



Item 6:  Selected Financial Data

The following is selected financial data only, and is qualified by the Financial
Statements, in their entirety, which are set forth elsewhere in this Form 10-K.



<TABLE>
                                              SUMMARY OPERATING DATA

<CAPTION>

Fiscal Year           February 28,         February 28,          February 29,         February 28,          February 28,
Ended                     1998                 1997                  1996                 1995                  1994
                     ---------------      ---------------       ----------------      --------------       ---------------

<S>               <C>                  <C>                   <C>                   <C>                  <C>
Total             $       6,899,977    $       4,776,418     $        3,999,759    $      2,687,950     $       2,001,118
Revenues (1)

Net Income                    6,637              258,329                507,179             338,438               248,202

Diluted                         .00                  .06
Earnings Per                                                                .12                 .08                   .07
Share (2)

Weighted
Average                   4,755,905            4,408,378                                                        3,630,819
  Number of                                                           4,401,135           4,256,999
Shares
  Outstanding


</TABLE>


<TABLE>

                           SUMMARY BALANCE SHEET DATA

Fiscal Year           February 28,         February 28,          February 29,         February 28,          February 28,
Ended                     1998                 1997                  1996                 1995                  1994
                     ---------------      ---------------       ----------------      --------------       ---------------

                                                                  (restated)

<S>               <C>                  <C>                   <C>                   <C>                  <C>
Working           $         479,454    $       1,447,754     $          974,102    $        766,951     $        (93,593)
Capital (1)

Total Assets              6,359,534            5,228,647              3,471,704           2,603,097             1,230,797

Long Term
Debt and

Obligations                 761,981              564,262                291,202             182,737                14,092
Under
  Capital
Leases, Less
  Current
Maturities

Stockholders'             4,104,955            4,060,201              2,448,230           1,843,471               590,819
Equity

</TABLE>


(1) CreditRisk  Monitor,  print product and Market Guide for Windows revenue are
deferred  at the  time of sale and  recognized  ratably  over  the  terms of the
subscriptions.  Costs  connected  with  the  procurement  of  subscriptions  and
memberships are expensed as incurred.

(2) Diluted earnings per share are computed based on the weighted average number
of shares of common stock outstanding in each fiscal year.


<PAGE>


                                                       PART II

Item 7:  Management's Discussion and Analysis of Financial Condition and Results
          of Operations


The  following  discussion  and analysis of the fiscal years ended  February 28,
1998,  February  28, 1997,  and February 29, 1996 should be read in  conjunction
with the Consolidated Financial Statements and Notes thereto.

Results of Operations

For the fiscal year ended February 28, 1998 compared to February 28, 1997

Total  revenues  for the fiscal year ended  February 28, 1998  increased  44% to
$6,899,977.  The growth in revenues reflects increases of 22% in database vendor
sales to $5,079,380  and 214% in Market Guide product sales to  $1,769,605.  The
revenue growth is attributable  to continued  sales to our  traditional  core of
vendors  that  sell  to  the  institutional,   retail  and  individual  investor
marketplaces, new revenue from the addition of more than thirty Internet related
vendors,  growth  in sales  at the  Company's  web  site  (www.marketguide.com),
incremental sales of Market Guide for Windows products,  and the introduction of
CreditRisk Monitor's Internet-based service  (www.creditriskmonitor.com)  in the
first quarter of this fiscal year. Print product revenues,  consisting mainly of
the Market Guide - Select OTC Stock  Edition,  decreased 18% to $50,992.  Market
Guide continues to concentrate on marketing electronic products and services.

Total  operating  expenses for the fiscal year ended February 28, 1998 increased
52% to $6,821,362.  The largest  component of this increase is  attributable  to
salaries and operating expenses related to the CreditRisk Monitor division. Also
contributing  to the increase in operating  expenses were costs  associated with
increased  staffing  levels  in  other  departments,   higher  depreciation  and
amortization  expenses,  and  increased  sales  and  marketing  activities.  For
financial  reporting  purposes,  CreditRisk  Monitor sales are recognized over a
defined period of time and expenses are recorded as incurred. The result is that
CreditRisk Monitor expenses continue to substantially exceed recognized sales.

Income from operations for the fiscal year ended February 28, 1998 decreased 74%
to $78,615.  The sharp decline in operating  income is attributable to operating
costs associated with the start-up of the CreditRisk Monitor division.

Interest  income for the fiscal year ended  February 28, 1998  decreased  32% to
$21,173. The decrease reflects lower cash balances throughout the year.

Interest  expense for the fiscal year ended  February 28, 1998  increased 14% to
$85,877. The increase in interest expense reflects the interest expense incurred
on borrowings under a line of credit provided by Fleet Bank.

Net income for the fiscal year ended  February 28, 1998  decreased from $258,329
to $6,637.  The decline in net income is  primarily  attributable  to  increased
expenses relating to the CreditRisk Monitor division.


For the fiscal year ended February 28, 1997 compared to February 29, 1996

Total  revenues  for the fiscal year ended  February 28, 1997  increased  19% to
$4,776,418  from  $3,999,759  in fiscal  year 1996.  The  increase  in  revenues
reflects a 13% increase in database  vendor sales to $4,150,777 and Market Guide
product sales growth of 119% to $563,788.  Revenue  growth was  attributable  to
continued sales gains in the Company's  traditional core of vendors, new revenue
from the  addition  of more  than a dozen  new  Internet  related  vendors,  the
introduction of our own web site (www.marketguide.com), and incremental sales of
Market Guide for Windows products.  Revenue growth was restrained by a permanent
reduction in revenue from an existing vendor  beginning in the second quarter of
fiscal  1997.  Print  product  revenues,  consisting  mainly of the Market Guide
Select OTC Stock  Edition,  decreased  9% to $61,853 from $67,928 in fiscal year
1996. The decline in sales continues to reflect lower sales to public  libraries
due to Market Guide's decision to concentrate on marketing  electronic  products
and services.

Total  operating  expenses for the fiscal year ended February 28, 1997 increased
30% to $4,475,976 from $3,455,120 in fiscal year 1996. Higher operating expenses
principally   reflected   increased  costs  associated  with  hiring  additional
personnel in all  departments to support faster  anticipated  growth,  increased
depreciation  and  amortization  and  rental  expenses,   and  several  one-time
non-recurring  expenses  in  the  fourth  quarter.  The  non-recurring  expenses
included filing and accounting fees related to the commencement of the Company's
stock trading on the Nasdaq SmallCap market in March 1997.

Income from operations for the fiscal year ended February 28, 1997 decreased 45%
to $300,442 from $544,639 in fiscal year 1996.  The decline in operating  income
primarily resulted from a permanent reduction in revenue from an existing vendor
and higher operating expenses.

Interest  income for the fiscal year ended  February 28, 1997  increased  26% to
$31,128  from  $24,641 in fiscal  year 1996.  The  increase  reflects  increased
earnings on higher cash balances throughout the fiscal year.

Interest  expense for the fiscal year ended  February 28, 1997  increased 24% to
$75,592  from $60,974 in fiscal year 1996.  Higher  interest  expenses  included
additional capital lease service requirements to fund equipment  acquisitions in
fiscal year 1997.

Income  tax  provision  for the fiscal  year ended  February  28,  1997  totaled
($2,351) compared with income tax expense of $1,127 in fiscal year 1996.

Net income for the fiscal year ended  February 28, 1997 declined 49% to $258,329
from  $507,179 in fiscal year 1996.  The decrease in net income was  principally
due  to the  previously  discussed  increases  in  expenses  and  the  permanent
reduction in revenue from an existing vendor relationship.

Liquidity and Capital Resources

As of February 28, 1998,  the Company's  working  capital  (current  assets less
current  liabilities)  decreased 67% to $479,454 when compared to the amounts at
February 28, 1997. The $968,300 working capital reduction  resulted  principally
from operating losses attributable to CreditRisk Monitor. The Company's cash and
cash  equivalents  decreased  34% to  $809,618  when  compared to the balance at
February 28, 1997. Cash resources were used to fund CreditRisk  Monitor and fund
development of computer software and database expansion.

For the fiscal year ended  February  28,  1998,  net cash  provided by operating
activities  increased 52% to $1,258,766  when compared to February 28, 1997. The
increase  reflects a sharp increase in unearned revenues  reflecting  CreditRisk
Monitor sales which are annual  subscriptions paid in advance,  advance payments
from  certain   customers  and  higher  non-cash   expenses   (depreciation  and
amortization),  partially offset by a higher accounts receivable balance related
to CreditRisk Monitor sales and a sharp reduction in net income.

For the  fiscal  year  ended  February  28,  1998,  net cash  used in  investing
activities  increased 5% to  $2,013,897  when  compared to the fiscal year ended
February 28, 1997. The increase reflects the Company's  continued  investment in
product and database enhancements and in Market Guide's Internet site.

For the fiscal year ended February 28, 1998, net cash from financing  activities
decreased 80% to $333,856  when  compared to the fiscal year ended  February 28,
1997. The decrease  reflects a private placement sale of common stock in January
1997 which generated proceeds of $1,201,771.

The Company believes its current liquidity is sufficient to meet its obligations
during the next twelve months.


Item 8:        Financial Statements and Supplementary Data

This information required by Item 8, and an index thereto,  appears at pages F-4
through F-18 (inclusive) of this Report, which pages follow page 19.


Item 9:        Disagreements on Accounting Financial Disclosure

None.


<PAGE>


                                    PART III

Item 10:     Directors and Executive Officers of the Registrant

    (a)  Identification of Directors

         The names, ages and principal occupations of the Company's Directors as
         of the end of the reporting period, and the data on which their term of
         office commenced and expires, are as follows:


<TABLE>
<CAPTION>

                                                               FIRST BECAME                     PRINCIPAL
          NAME                AGE        TERM OF OFFICE          DIRECTOR                      OCCUPATION
========================== =========== ==================== =================== ==========================================

<S>                            <C>              <C>                <C>
John D. Case                   53               1                  1984         Chairman  of  the  Board  of   Directors,
                                                                                General  Counsel  and  Secretary  of  the
                                                                                Company

Homi M. Byramji                45               1                  1988         President,   Chief   Executive   Officer,
                                                                                Treasurer and Director of the Company

Raymond B. Dooley              51               1                  1989         Banker,   specializing   in   structuring
                                                                                government  backed  loans and Director of
                                                                                the Company

Mark B. Burka                  48               1                  1995         Portfolio  Manager,  Manager  Pension and
                                                                                Deferred   Benefit    Investments,    Aon
                                                                                Advisors,   Inc.   and  Director  of  the
                                                                                Company

Steven A. Hirsh                58               1                  1997         Portfolio  Manager,  William Harris & Co.
                                                                                and Director of the Company

Thomas A. Prendergast          64               1                  1997         Management  Consultant,  Certified Public
                                                                                Accountant,  Entrepreneur and Director of
                                                                                the Company

========================== =========== ==================== =================== ==========================================

</TABLE>


  (1)    Directors are elected at the annual  meeting of  stockholders  and hold
         office until the following annual meeting.

  (2)    Time,  Inc. has the right to name a Director to the Board as long as it
         retains at least a 3.5% ownership in the Company.  Time, Inc. currently
         owns 3.3% of the shares  outstanding and has not exercised its right to
         name a Director since 1987.

  (3)    Changes since end of reported  period:  Yes.  Added two new  directors,
         Steven A. Hirsh and Thomas A. Prendergast.

    (b)  Business Experience

John D. Case, age 53, is a graduate of Hofstra University (B.A. 1968)
and Suffolk University Law School (J.D. 1971). He is admitted to
the practice of law in New York State and Federal jurisdictions.
Prior to assuming the Company's Presidency and Chairmanship in
February 1989, he was a Director of the Company (elected 1984) and
was engaged in the practice of law. Mr. Case served as President
and CEO of the Company from February 1989 to February 1992. Mr.
Case is currently compensated in the form of cash and qualifies for the
Key Employee Incentive Plan.

Homi M. Byramji,  age 45, a Director  since 1988,  had  previously  consulted in
computerized  equity  research  for nine  years.  He holds a  Masters  Degree in
Business  Administration,  Rutgers  University  (1975) and became  Secretary and
Treasurer of the Company on February 23, 1989.  Mr. Byramji  remained  Treasurer
and assumed the duties of President and CEO on March 1, 1992. He is  compensated
in the form of cash and qualifies for the Key Employee Incentive Plan.

Raymond B. Dooley, age 51, joined the Board of Directors in
March 1989. He is a banker specializing in structuring government
backed corporate loans. Mr. Dooley holds a Masters Degree in Business
Administration from St. John's University.

Mark B. Burka, C.F.A., age 48, joined the Board of Directors in August 1995. He
is a Chartered Financial Analyst and Manager of Pension and Deferred Benefit
Investments with Aon Advisors, Inc. Mr. Burka hold a Masters Degree in Business
Administration from the University of Chicago, Graduate School of Business, and
a Bachelor of Arts from the University of Wisconsin in Madison, Wisconsin.
He has been employed with Aon Advisors, Inc. and its predecessors since 1977.

Steven A. Hirsh, age 58, joined the Board of Directors in November 1997. He is a
portfolio manager for William Harris & Company, a financial services company,
located in Chicago, Illinois. Since 1994 he has been the Chairman, President and
CEO of Astro Communications, Inc. (OTCBB: ASTO). He currently serves as a
director of Complete Management, Inc. (NYSE: CMI) and the Reliance Standard Life
Insurance Company and First Reliance subsidiaries of Delphi Financial Group
(NYSE: DFG). Mr. Hirsh earned a B.S. degree at the University of Colorado and
holds an MBA from the University of Chicago.

Thomas A.  Prendergast,  age 64, joined the Board of Directors in November 1997.
He is an El Paso, Texas based management consultant,  entrepreneur,  and private
investor who has previously served on the boards of sixteen public companies. In
five instances he was Chairman of their  respective  boards.  A Certified Public
Accountant,  Mr. Prendergast holds a B.S. degree from Fordham University and has
engaged in  post-graduate  studies at the University of Texas, El Paso. He was a
founding member of the El Paso Community  College and served as the President of
its Board of Trustees from 1969 to 1982.

All Directors of the Company will serve in such  capacity  until the next annual
meeting of the Company's  stockholders and until their successors have been duly
qualified and elected.

Item 11:     Executive Compensation

Summary of Executive Compensation

The  following  table sets forth the total  compensation  paid or accrued by the
Company to  executive  officers  of the  Company  who served in such  capacities
during fiscal year 1998 (the "Named Officers") for services rendered during each
of the last three fiscal years.

                           SUMMARY COMPENSATION TABLE


<TABLE>


<CAPTION>
                                                    Annual Compensation                        Long-Term Compensation Awards
                                        ---------------------------------------------       ----------------------------------
                                                                                                   Securities Underlying
     Name and Principal Position        Fiscal Year          Salary             Bonus                Options Granted (#)
<S>                                         <C>             <C>                   <C>                              <C>
Homi M. Byramji.................            1998            $200,000             -0-                       -0-
  President, Chief Executive                1997             200,000             -0-                       -0-
  Officer and Treasurer                     1996             170,000             -0-                       -0-
John D. Case.......................         1998            $125,000             -0-                       -0-
  Chairman, General Counsel                 1997             125,000             -0-                       -0-
  and Secretary                             1996              75,000             -0-                       -0-


</TABLE>

Employment Agreements

None of the Company's  Executive  Officers  currently have employment  contracts
with the Company.

Employee Stock Purchase Plan

At the August 31,  1995 annual  shareholders'  meeting,  the Board of  Directors
approved an Employee Stock Purchase Plan. The Plan enables employees to purchase
common stock of the Company through payroll deductions and/or cash payments at a
15% discount based on the lower of the average closing price during the quarter,
or the average closing price for the last five days of the quarter.

Key Employee Incentive Plan

At the August 31, 1995 annual shareholders' meeting, the shareholders approved a
plan that creates the ability to grant stock and/or options to purchase stock of
the Company to key corporate employees.

Outside Directors' Plan

At the August 31, 1995 annual shareholders' meeting, the shareholders approved a
plan that  creates the ability to grant stock  and/or  non-qualified  options to
purchase stock of the Company to outside directors.


<PAGE>


Item 12:     Security Ownership of Certain Beneficial Owners and Management

The following  table sets forth  certain  information  regarding the  beneficial
ownership of the Company's  Common Stock as of May 15, 1998 by all persons known
to the Company to be  beneficial  owners of more than 5% of its Common Stock and
all Officers and Directors,  both  individually  and as a Group. For purposes of
calculating the amount of beneficial  ownership and the respective  percentages,
the number of shares of Common  Stock which may be acquired by a person upon the
exercise of  outstanding  warrants,  options or upon  conversion of  outstanding
promissory  notes,  are  considered  outstanding,  but shall not be deemed to be
outstanding for the purpose of computing the percentage of Common Stock owned by
any other person. <TABLE>

<CAPTION>

NAME AND ADDRESS OF                         AMOUNT AND NATURE OF                                        APPROXIMATE
BENEFICIAL OWNER                            BENEFICIAL OWNERSHIP (1)                           PERCENT OF CLASS (2)


<S>           <C>                             <C>                                                <C>
Mark B. Burka (3) (4)                            806,00016                                          .9%
618 Washington Avenue
Wilmette, IL  60091

Homi M. Byramji (5)                              549,06411                                          .5%
One Sheep Hill Road
Boonton Township, NJ 07005

John D. Case (5)                                 768,99416                                          .2%
12 Timberland Lane
Old Brookville, NY 11545

Raymond B. Dooley (6)                            12,187                                             .3%
98 Eighth Avenue
Sea Cliff, NY  11579

William Harris & Company (7)                     28,000                                             .6%
Profit Sharing Trust
2 North LaSalle Street
Chicago, IL  60602

Steven A. Hirsh                                      -                                              -
1895 Lake Avenue
Highland Park, IL  60035

Thomas A. Prendergast (8)                        88,4501                                            .9%
3907 North Mesa, Apt. 200A
El Paso, TX  79902

All Directors and Officers                       2,252,695                                          46.8%
as a Group (6 persons)

</TABLE>


(1) Unless  otherwise  indicated,  all shares  are  directly  owned and the sole
voting and investment power is held by the persons named.

(2) Based upon 4,748,594 shares of Common Stock issued and outstanding as of May
15, 1998.

(3) Includes  options for the purchase of 10,000 shares of Common Stock at $2.50
per share and for the  purchase  of 10,000  shares of Common  Stock at $3.00 per
share.

(4) Shares owned directly and owned by Mark B. Burka,  Trustee FBO Mark B. Burka
Trust.

(5) Includes  options for the purchase of 12,500 shares of Common Stock at $2.68
 per share.

(6)  Includes  options for the purchase of 5,000 shares of Common Stock at $2.50
per share and 5,000 shares of Common Stock at $3.00 per share.

(7) Steven Hirsh, a Market Guide director, is employed as a
Portfolio Manager for William Harris & Company Profit Sharing
Trust.

(8)  Includes  options for the purchase of 5,000 shares of Common Stock at $3.00
per share.

The Company does not know of any  arrangements  or pledge of its  securities  by
persons now  considered  in control of the Company that might result in a change
of control of the Company.

Item 13:    Certain Relationships and Related Party Transactions

None.

Item 14: Financial Statements and Financial Statement Schedules, Exhibits and
 Reports on Form 8-K and 8-A

   (a) (1) (2)    Financial Statements and Financial Statement Schedules

      A list of the Financial Statements and Financial Statement Schedules filed
      as a part of this  Report is set forth in Item 8, and  appears at Page F-2
      of this Report; which is incorporated herein by reference.

   (a) (3)    Exhibits

              3            Certificate of Incorporation and Amendments thereto*
              3(A)By-Laws*

   (b)        Reports on Form 8-K


In    June 1996, Market Guide announced the signing of a multi-year  contract to
      provide  Reuters Ltd. with the right to use and distribute the contents of
      the Market  Guide  database.  The Company  deems the  acquisition  of this
      contract to be of importance to its shareholders.



<PAGE>


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934, the Registrant has caused this Report to be signed on its behalf by
the undersigned,  as principal  financial and accounting  officer thereunto duly
authorized.

                                                 MARKET GUIDE INC.

Dated:   May 28, 1998
Lake Success, New York                           /s/ Homi M. Byramji
                                                 Homi M. Byramji
                          President, CEO and Treasurer


Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the dates indicated.

<TABLE>

<CAPTION>

SIGNATURES                                       TITLE                                 DATE
--------------------------------------- -------- ------------------------------------- --------------------------------------



<S>                                                   <C>                                   <C>
                                                 Chairman of the Board
                                                 and Secretary                         May 28, 1998
/s/ John D. Case
JOHN D. CASE

                                                 President, CEO,
                                                 Treasurer and Director                May 28, 1998
/s/ Homi M. Byramji
HOMI M. BYRAMJI


                                                 Director                              May 28, 1998
/s/ Mark B. Burka
MARK B. BURKA


                                                 Director                              May 28, 1998
/s/ Raymond B. Dooley
RAYMOND B. DOOLEY


                                                 Director                              May 28, 1998
/s/ Steven A. Hirsh
STEVEN A. HIRSH


                                                 Director                              May 28, 1998
/s/ Thomas A. Prendergast
THOMAS A. PRENDERGAST

</TABLE>

<PAGE>




                                MARKET GUIDE INC.



                              FINANCIAL STATEMENTS

                                       AND

                         REPORT OF INDEPENDENT AUDITORS'



                      FOR THE YEARS ENDED FEBRUARY 28, 1998

                             FEBRUARY 28, 1997, AND

                                FEBRUARY 29, 1996



<PAGE>


                                Table of Contents


Financial Statements


Report of Independent Auditors'

Balance Sheets for the Fiscal Years Ended February 28, 1998
and February 28, 1997                                                      F-4-5

Statements  of  Operation  and  Accumulated  Deficit for the Fiscal  Years Ended
February 28, 1998, February 28, 1997, and February 29, 1996 F-6

Statements of Cash Flows for the Fiscal Years Ended February 29, 1998,  February
28, 1997, and February 29, 1996 F-7

Statements of Stockholders' Equity for the Fiscal Years Ended February 28, 1998,
February 28, 1997, and February 29, 1996 F-8

Notes to Financial Statements February 28, 1998, February 28, 1997,
and February 29, 1996                                                     F-9-18



<PAGE>


                                       [Zerbo, McKiernan & Zambito Letterhead]




                                           REPORT OF INDEPENDENT AUDITORS'


To the Board of Directors and Stockholders of
Market Guide Inc.
2001 Marcus Avenue, Suite S200
Lake Success, NY  11042-1011

We have  audited  the  accompanying  Balance  Sheets of Market  Guide Inc. as of
February 28, 1998 and February 28, 1997 and the related  Statements of Operation
and  Accumulated  Deficit,  Cash  Flows and  Stockholders'  Equity for the years
February  28, 1998,  February  28, 1997 and February 29, 1996 then ended.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  financial  position  of Market  Guide Inc.  as of
February 28, 1998 and February  28, 1997 and the results of its  operations  and
its cash flows for the years  February 28, 1998,  February 28, 1997 and February
29, 1996 then ended in conformity with generally accepted accounting principles.



/s/ Zerbo, McKiernan & Zambito, L.L.C

Zerbo, McKiernan & Zambito, L.L.C
Fairfield, New Jersey
May 18, 1998



<PAGE>
<TABLE>


                                MARKET GUIDE INC.
                                 Balance Sheets


<CAPTION>

                                                                            February 28,                    February 28,
                                                                                1998                            1997
                                                                     ---------------------------     ----------------------------

ASSETS
Current assets:
<S>                                                              <C>                          <C>
  Cash                                                           $                809,618     $                  1,230,893
    Accounts receivable (net of allowance
  for doubtful accounts)                                                        1,047,449                          557,415
  Prepaid expenses and other current assets                                       114,985                          263,630
                                                                     ---------------------           ----------------------

    Total current assets                                                        1,972,052                        2,051,938

Property, plant and equipment:
  Furniture and equipment                                                       1,623,206                          936,097
  Equipment held under capital leases                                             942,950                          942,949
  Leasehold improvements                                                           80,990                           72,509
                                                                     ---------------------           ----------------------

                                                                                2,647,146                        1,951,555

Less:  Accumulated depreciation and amortization
(including amortization of $367,610 and $189,234
in 1998 and 1997, respectively, on capital leases)                              1,117,876                          744,551
                                                                     ---------------------           ----------------------

  Net property, plant and equipment                                             1,529,270                        1,207,004

Other assets:
  Computer software and database expansion
  (net of accumulated amortization)                                             2,780,128                        1,891,621
  Deposits and other assets                                                        78,084                           78,084
                                                                     ---------------------           ----------------------

    Total other assets                                                          2,858,212                        1,969,705
                                                                     ---------------------           ----------------------

      Total assets                                               $              6,359,534     $                  5,228,647
                                                                     =====================           ======================


</TABLE>





The accompanying notes are an integral part of these financial statements.


<PAGE>


                                MARKET GUIDE INC.
                           Balance Sheets - continued


<TABLE>

<CAPTION>
                                                                             February 28,                     February 28,
                                                                                 1998                             1997
                                                                       --------------------------     -----------------------------

LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:
  Current maturities of long-term debt and capital
<S>                                                                <C>                         <C>
   Leases                                                          $               274,031     $                      176,012
  Unearned revenues                                                                999,949                            248,679
  Accounts payable and other accrued expenses                                      218,618                            179,493
                                                                       --------------------           ------------------------

    Total current liabilities                                                    1,492,598                            604,184

Non-current liabilities:
  Long-term debt and capital lease obligations,
   less current maturities                                                         761,981                            564,262
                                                                       --------------------           ------------------------

    Total non-current liabilities                                                  761,981                            564,262

     Total liabilities                                                           2,254,579                          1,168,446

Stockholders' equity:
Common stock - $.001 par value;  20,000,000  shares  authorized,  4,723,594  and
  4,708,186 shares issued and outstanding in 1998 and 1997,
  respectively                                                                       4,723                              4,708

Capital in excess of par value                                                   5,010,134                          4,972,032

Retained earnings (deficit)                                                      (909,902)                          (916,539)
                                                                       --------------------           ------------------------

            Total stockholders' equity                                           4,104,955                          4,060,201
                                                                       --------------------           ------------------------

            Total liabilities and stockholders' equity             $             6,359,534     $                    5,228,647
                                                                       ====================           ========================

</TABLE>


The accompanying notes are an integral part of these financial statements.


<PAGE>



                                MARKET GUIDE INC.
                Statements of Operation and Accumulated Deficit

<TABLE>
<CAPTION>

                                                                                For the Years Ended
                                                            ------------------------------------------------------------------
                                                               February 28,             February 28,           February 29,
                                                                   1998                     1997                   1996
                                                            -------------------      -------------------     -----------------

Revenues:
<S>                                                    <C>                       <C>                     <C>
  Database vendors                                     $             5,079,380   $            4,150,777  $          3,674,830
  Market Guide products                                              1,769,605                  563,788               257,001
  Print product                                                         50,992                   61,853                67,928
                                                            -------------------      -------------------     -----------------

    Total revenues                                                   6,899,977                4,776,418             3,999,759

Expenses:
 Salaries, payroll taxes & employee benefits                         4,151,529                2,692,063             2,121,109
 Database and product costs                                            460,919                  395,217               322,670
 General and administrative                                          1,078,237                  733,087               574,740
 Depreciation                                                          373,325                  228,576               149,666
 Amortization                                                          429,798                  288,072               199,233
 Advertising and promotion                                             327,554                  138,961                87,702
                                                            -------------------      -------------------     -----------------

    Total expenses                                                   6,821,362                4,475,976             3,455,120

Income from operations                                                  78,615                  300,442               544,639

Interest income                                                         21,173                   31,128                24,641
Interest expense                                                        85,877                   75,592                60,974
                                                            -------------------      -------------------     -----------------

Income before income taxes                                              13,911                  255,978               508,306
Provision for income taxes                                               7,274                  (2,351)                 1,127
                                                            -------------------      -------------------     -----------------

    Net income                                         $                 6,637   $              258,329  $            507,179
                                                            ===================      ===================     =================

Accumulated deficit, beginning of year                               (916,539)              (1,174,868)           (1,682,047)
                                                            -------------------      -------------------     -----------------

Accumulated deficit, end of year                       $             (909,902)   $            (916,539)  $        (1,174,868)
                                                            ===================      ===================     =================


Earnings per share:
  Basic                                                $                  0.00   $                 0.06  $               0.12
  Diluted                                              $                  0.00   $                 0.06  $               0.12

Weighted average number of shares outstanding:
  Basic                                                              4,712,503                4,250,124             4,165,457
  Diluted                                                            4,755,905                4,408,378             4,401,135


</TABLE>


The accompanying notes are an integral part of these financial statements.


<TABLE>


                                MARKET GUIDE INC.
                            Statements of Cash Flows

<CAPTION>
                                                                                       For the Years Ended
                                                                  ---------------------------------------------------------------
                                                                     February 28,            February 28,         February 29,
                                                                         1998                    1997                 1996
                                                                  --------------------     -----------------     ----------------
                                                                                                                   (restated)

Cash Flows From Operating Activities:
<S>                                                          <C>                       <C>                   <C>
Net income                                                   $                  6,637  $            258,329  $           507,179
                                                                  --------------------     -----------------     ----------------
Adjustments  to  reconcile   net  income  to  net  cash  provided  by  operating
  activities:
    Depreciation and amortization                                             803,123               516,648              348,899


Changes in assets and liabilities:
(Increase)/Decrease in accounts receivable                                  (490,034)               203,765            (202,367)
(Increase)/Decrease in prepaid assets                                         148,645                   781            (199,540)
(Increase)/Decrease in deposits and other assets                                  -0-              (14,858)              (6,750)
Increase/(Decrease) in accounts payable                                        39,125             (222,053)              185,548
Increase/(Decrease) in unearned revenues                                      751,270                85,308             (39,494)
                                                                                           -----------------
                                                                  --------------------                           ----------------
  Total adjustments                                                         1,252,129               569,591               86,296
                                                                  --------------------     -----------------     ----------------

Net cash provided by operating activities                                   1,258,766               827,920              593,475
                                                                  --------------------     -----------------     ----------------

Cash Flows From Investing Activities:
Payments for purchase of fixed assets                                       (687,111)             (695,447)            (372,475)
Payments for leasehold improvements                                           (8,481)              (72,509)                  -0-
Development of computer software and
 database expansion                                                       (1,318,305)           (1,145,213)            (519,488)
                                                                  --------------------     -----------------     ----------------

Net cash used by investing activities                                     (2,013,897)           (1,913,169)            (891,963)
                                                                  --------------------     -----------------     ----------------

Cash Flows From Financing Activities:
Payments for long term debt and capital leases                              (176,011)             (250,392)             (60,428)
Proceeds from capital leases and equipment line of credit                     471,750               532,110              246,984
Proceeds from issuance of employee's and director's
  stock plan                                                                   38,117                51,869               64,129
Proceeds from private placement of common stock                                   -0-             1,201,771                  -0-
Proceeds from stock options exercised                                             -0-               100,001               33,451
                                                                  --------------------     -----------------     ----------------

Net cash provided by financing activities                                     333,856             1,635,359              284,136
                                                                  --------------------     -----------------     ----------------

Net increase/(decrease) in cash                                             (421,275)               550,110             (14,352)
Cash at beginning of year                                                   1,230,893               680,783              695,135
                                                                  --------------------     -----------------     ----------------

Cash at end of year                                          $                809,618  $          1,230,893  $           680,783
                                                                  ====================     =================     ================

Supplemental disclosure of cash flow information: Cash paid during the year for:
   Interest                                                  $                 85,877  $            137,578  $            60,974
   Corporate taxes                                                              6,000                 4,200                5,250


The accompanying notes are an integral part of these financial statements.
</TABLE>


<PAGE>




<TABLE>


                                                  MARKET GUIDE INC.
                                          Statements of Stockholders' Equity
<CAPTION>

                                                                        Capital in                                     Total
                                                                         Excess of            Accumulated          Stockholders'
                                   Shares            Par Value           Par Value              Deficit               Equity
                               ---------------      -------------     ----------------      ----------------      ----------------


<S>                                        <C>         <C>               <C>                   <C>                   <C>
Balance at February 28, 1995        4,112,697   $          4,113  $         3,521,405   $       (1,682,047)   $         1,843,471


Stock Options Exercised                45,717                 45               33,406                   -0-                33,451
Issuance of common stock
 pursuant to employee stock            29,831                 30               64,099                   -0-                64,129
plan
Net income for the year                   -0-                -0-                  -0-               507,179               507,179
                               ---------------      -------------     ----------------      ----------------      ----------------
Balance at February 29, 1996        4,188,245              4,188            3,618,910           (1,174,868)             2,448,230
                               ---------------      -------------     ----------------      ----------------      ----------------


Issuance of common stock in a
 private placement for cash           343,363                344            1,201,428                   -0-             1,201,772
Stock options exercised               158,334                158               99,843                   -0-               100,001
Issuance of common stock
 pursuant to employee's and
 director's stock plans                18,244                 18               51,851                   -0-                51,869
Net income for the year                   -0-                -0-                  -0-               258,329               258,329
                               ---------------      -------------     ----------------      ----------------      ----------------

Balance at February 28, 1997        4,708,186              4,708            4,972,032             (916,539)             4,060,201
                               ---------------      -------------     ----------------      ----------------      ----------------


Issuance of common stock
 pursuant to employee's and
 director's stock plans                15,408                 15               38,102                   -0-                38,117
Net income for the year                   -0-                -0-                  -0-                 6,637                 6,637
                               ---------------      -------------     ----------------      ----------------      ----------------

Balance at February 28, 1998        4,723,594   $          4,723  $         5,010,134   $         (909,902)   $         4,104,955
                               ===============      =============     ================      ================      ================

</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>


                                MARKET GUIDE INC.
                          Notes to Financial Statements
                    February 28, 1998, February 28, 1997 and
                                February 29, 1996

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.   Nature of Business

     Market  Guide Inc.  was  incorporated  on March 23,  1983,  as The Unlisted
     Market  Service  Corporation  for the purpose of collecting  information to
     produce corporate profile reports on unlisted publicly traded companies. On
     September 3, 1986, the current corporate name was adopted.  Market Guide is
     currently  engaged in acquiring,  condensing,  publishing and  distributing
     historical  and  current   financial   information   and  software  to  the
     individual, financial services, and institutional investor marketplaces.

     The majority of the Company's revenue is derived from approximately seventy
     third party vendors who distribute and sell Market Guide database products.
     Sales are made  through  both third party  vendors and direct  sales to end
     users.

2.   Revenue Recognition

     Database revenues from certain information vendors are not completely known
     until after the end of the fiscal period.  In these  instances,  management
     uses  estimates in recording  vendor  revenue in accordance  with generally
     accepted accounting  principles.  Accordingly,  actual results could differ
     from  these  estimates.   Subsequent  adjustments  are  made  after  actual
     collection.

     CreditRisk Monitor  subscriptions,  print product revenues and Market Guide
     for  Windows  revenues  are  deferred  at the time of sale  and  recognized
     ratably as revenues over the terms of their subscriptions. Costs associated
     with procurement of these revenues are expensed as incurred.

     Bad debts are recorded under the allowance  method of  accounting.  For the
     fiscal years ended  February  28, 1998,  February 28, 1997 and February 29,
     1996,  $0,   $5,000,   and  $15,000  were  charged  to  bad  debt  expense,
     respectively.  As of February 28, 1998 and February 28, 1997, the allowance
     for doubtful accounts remained at $24,207.

3.   Property and Equipment

      Depreciation and  amortization  are provided for in amounts  sufficient to
      relate the cost of depreciable  assets to their  estimated  useful service
      lives. Leased property under capital leases is amortized over the lives of
      the  respective  leases or over the service  lives of the assets for those
      leases which substantially transfer ownership.

      The straight-line method of depreciation is followed for substantially all
      assets for both financial and tax reporting purposes. For the fiscal years
      ended  February  28,  1998,  February  28,  1997 and  February  29,  1996,
      $373,325,   $228,576   and   $149,666,   respectively,   were  charged  to
      depreciation  expense,  as  shown  in  the  Statements  of  Operation  and
      Accumulated Deficit on page F-6.



<PAGE>


4.   Capitalization of Computer Software and Database Expansion

     Management  has  elected,  pursuant to SFAS No. 86, to  capitalize  certain
     computer  software costs incurred for new product  development and database
     expansion for the periods since February 28, 1989. These costs are reported
     at the lower of unamortized cost or net realizable  value. The amortization
     of these costs are included in database and product cost.  All research and
     development,  database  maintenance and customer support costs are expensed
     as incurred.

     The  straight-line  method  of  amortization  is used  over  the  estimated
     economic  life of the asset.  For the years  ended  February  28,  1998 and
     February  28,  1997,  capitalization  of  computer  software  and  database
     expansion totaled $1,318,305 and $1,145,213,  respectively.  For the fiscal
     years ended  February  28,  1998,  February 28, 1997 and February 29, 1996,
     $429,798, $288,072 and $199,233, respectively, were charged to amortization
     expense.  As of  February  28,  1998 and  February  28,  1997,  accumulated
     amortization was $1,602,353 and $1,172,555, respectively.

5.   Earnings Per Share

     Basic earnings per share are computed based on the weighted  average number
     of shares of  Common  Stock  outstanding.  Diluted  earnings  per share are
     calculated  based on the weighted average number of shares plus outstanding
     stock options.

6.   Fair Value of Financial Instruments

     The  following  methods  and  assumptions  were  used  by  the  Company  in
     estimating its fair value disclosures for financial instruments:

     Cash  and  cash  equivalents:   The  carrying  amounts  of  cash  and  cash
     equivalents approximate their fair values.

     Capital  lease   obligations:   The  carrying   amounts  of  capital  lease
     obligations approximate their fair value.

7.   Employee Benefit Plan

     The Company  established  a 401(k) plan  effective  January 1, 1997 for all
     employees  with  over six  months  of  service.  On an  annual  basis,  the
     employees may contribute the lesser of 15% of gross salary or $10,000.  The
     Company  matched  50% of the first 6% of the  employees'  contributions  in
     calendar  1997,  and  matched  20%  of  the  first  6%  of  the  employees'
     contributions  in calendar  1998.  Future  Company  matches  will depend on
     Company profitability. Participants are vested 20% for each year of service
     and are fully  vested  after 5 service  years.  For the fiscal  years ended
     February 28, 1998 and February 28, 1997,  the Company  contributed  $71,041
     and $16,791 to the plan, respectively.

8.    Use of Estimates

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions   that  affect  certain   reported   amounts  and  disclosures.
     Accordingly, actual results could differ from those estimates.


<PAGE>

<TABLE>

NOTE B -  LONG-TERM DEBT AND OTHER BORROWING ARRANGEMENTS

<CAPTION>

                                                                February 28,               February 28,
                                                                    1998                       1997
                                                              ------------------        -------------------
<S>                                                              <C>                                 <C>
           Fleet Bank line of credit                             $      471,750            $           -0-
           Capital lease obligations                                    564,262                    740,274
                                                              ----- ------------        ----- -------------
                                                                      1,036,012                    740,274
           Less:  Current maturities                                    274,031                    176,012
                                                              ----- ------------        ----- -------------
           Total long-term debt
                and capitalized leases                           $      761,981            $       564,262
                                                              ===== ============        ===== =============

</TABLE>

On April 15, 1997,  the Company  secured a $1,000,000  line of credit with Fleet
Bank. The credit line is secured by a first-priority perfected security interest
in all present and future  assets of the Company.  The Company must maintain net
earnings on a  consolidated  basis of not less than $1 in any fiscal  year,  and
total consolidated liabilities to tangible net worth may not exceed a 1.5 to 1.0
ratio at any fiscal  quarter end. The interest rate on the line of credit ranges
from prime rate plus 1/4% to prime rate plus 1/2%.

Annual  scheduled  principal  maturities  of  long-term  debt and capital  lease
obligations as of February 28, 1998 are summarized as follows:

<TABLE>

<CAPTION>

                                                                                         Total of Long-Term Debt
                                             Long-Term            Capital Lease             and Capital Lease
                                               Debt                Obligations                 Obligations
                                          ----------------       ----------------       ---------------------------
Year Ending February 28(29),
<S>  <C>                               <C>                    <C>                    <C>
     1999                              $           78,625     $          195,405     $                     274,030
     2000                                         157,250                201,625                           358,875
     2001                                         157,250                140,486                           297,736
     2002                                         78,625                 26,746                           105,371
                                          ================       ================       ===========================
     TOTAL                             $          471,750     $          564,262     $                   1,036,012
                                          ================       ================       ===========================



</TABLE>

<PAGE>


NOTE C - COMMITMENTS AND CONTINGENCIES

1.   Capital Leases

The schedule of future minimum lease  payments for the Company's  capital leases
and the present value of the net minimum lease payments are as follows:
<TABLE>
<CAPTION>

                                                                  Fiscal                   $ Amount
                                                                    Year
                                                                ------------         ---------------
<S>                                  <C>                           <C>                      <C>
                Year ending February 28 (29),                      1999                     246,519
                                                                   2000                     229,791
                                                                   2001                     149,859
                                                                   2002                      27,400
                                                                                     ---------------
                Total minimum lease payments                                      $         653,569

                Less:  Amounts representing interest                                         89,307
                                                                                     ---------------

                Present value of net minimum
                  lease payments as of February 28, 1998                          $         564,262
                                                                                     ===============

</TABLE>

2.   Operating Leases

The Company rents its three office facilities under operating leases. Two of the
offices are located in Lake Success, New York with a lease expiration in October
2005,  and the  other  office  is  located  in  Chicago,  Illinois  with a lease
expiration in May 1998.  The Chicago  office lease will not be renewed.  For the
periods  ended  February  28,  1998,  February  28, 1997 and  February 29, 1996;
$393,632, $205,975, and $127,910 were charged to rent expense, respectively.

The Company can exercise a buyout option for the Lake Success,  New York offices
in October 2001 for the amount of $165,134.  The annual  minimum lease  payments
under the operating leases as of February 28, 1998 are:



                                            Fiscal Year            $ Amount
                                           -------------         ---------------

 Year ending February 28 (29),                  1999                 441,394
                                                2000                 452,836
                                                2001                 467,169
                                                2002                 482,051
                                                2003                 497,473
                                                2004                 513,337
                                                2005                 529,812
                                                2006                 360,740
                                                                 ---------------

                                                    Total       $    3,744,812
                                                                ===============


<PAGE>


NOTE C - COMMITMENTS AND CONTINGENCIES (continued)

3.   Legal Proceedings

The Company is currently involved in a pending lawsuit.  The ultimate outcome of
this  litigation is unknown at the present time.  Accordingly,  no provision for
any liability has been made to the accompanying financial statements. Management
does not  believe  that  pending  actions  will  have a  material  effect on the
business activities of the Company.

NOTE D - INCOME TAXES

The Company has adopted SFAS 109 and as of February  28, 1998 has net  operating
loss and  investment  tax credit  carryforwards  in the amount of  $873,877  and
$10,524,  respectively.  Pursuant to SFAS 109,  management believes that it does
not  have  a  greater  than  50%   probability   of  realization  of  such  loss
carryforwards  and  credits  and has  decided  to provide  for a full  valuation
allowance.  The investment tax credits will begin to expire,  if unused,  in the
fiscal year ending  February  28, 1999.  Annual  fiscal year  expirations  total
$3,588 in 1999;  $5,470 in 2000; $1,466 in 2001. Net operating losses will begin
to expire, if unused, in the fiscal year ending February 29, 2002. Annual fiscal
year  expirations  total  $585,394 in 2002 and $288,483 in 2003. The Company has
recorded  deferred tax assets related to the allowance for doubtful  accounts in
deposits  and other  assets.  As of February  28, 1998 and February 28, 1997 the
deferred tax assets remained at $11,116.


The components of the provisions for income taxes (credits) are as follows:
<TABLE>


<CAPTION>
                                                            For the Years Ended
                                         -----------------------------------------------------------
                                                   02/28/98            02/28/97            02/29/96
                                         -------------------- ------------------ -------------------
<S>                                                         <C>              <C>                  <C>
           Current
              Federal                          $         -0-      $         -0-     $         2,900
              State and Local                          7,274            (4,734)               4,977
           Deferred
              Federal                                    -0-              1,801             (5,100)
              State and Local                            -0-                582             (1,650)
                                         ======== =========== ====== =========== ===== =============
                              TOTALS           $       7,274      $     (2,351)     $         1,127
                                         ======== =========== ====== =========== ===== =============


</TABLE>


<PAGE>


NOTE D - INCOME TAXES (continued)

Total income tax expense  differs  from the  expected  tax expense  (computed by
applying  the U.S.  Federal  statutory  income tax rate of 34% to income  before
income taxes) as follows:

<TABLE>



<CAPTION>
                                              2/28/98          %            2/28/97           %           2/29/96         %
                                     ----------------- ---------- ------------------ ----------- ----------------- ---------
<S>                                      <C>                <C>             <C>            <C>       <C>               <C>
Tax at Federal statutory rate            $      4,730       34.0     $       87,033        34.0      $    172,824      34.0
Federal alternative minimum tax                   -0-        0.0                -0-         0.0             2,900       0.6
State income taxes, net of
  Federal tax benefit                           4,801       34.5            (2,542)       (1.0)             1,636       0.3
Net operating loss
  carryforwards, utilized                     (2,283)     (16.3)           (88,324)      (34.5)         (179,716)    (35.4)
Other                                              26        0.0              1,482         0.6             3,483       0.7
                                     ====== ========== ========== ===== ============ =========== ====== ========== =========
                             TOTALS      $      7,274       52.2     $      (2,351)       (0.9)      $      1,127       0.2
                                     ====== ========== ========== ===== ============ =========== ====== ========== =========
</TABLE>

Income taxes payable as of February 28, 1998, February 28, 1997 and February 29,
1996 are as follows:

<TABLE>


<CAPTION>
                                                2/28/98            2/28/97              2/29/96
                                        ---------------- ------------------ --------------------
<S>                                        <C>       <C>     <C>        <C>         <C>
           Federal                         $        -0-      $         -0-          $     2,900
           State and Local                        2,803                929                  -0-
                                        ===== ========== ====== =========== ========== =========
                                TOTALS     $      2,803      $         929          $     2,900
                                        ===== ========== ====== =========== ========== =========

</TABLE>

NOTE E - STOCKHOLDERS' EQUITY

1.   Common Stock

On January 27, 1997 the Company  raised  $1,201,771  through the sale of 343,363
shares  of  restricted  common  stock at a price of $3.50 per share in a private
placement to a limited number of institutional and individual investors.

On March 21, 1994 the Company raised $853,370 through the sale of 568,930 shares
of  restricted  common  stock at a price of $1.50 per  share,  adjusted  for the
October 1995  one-for-four  reverse stock split,  in a private  placement with a
limited number of institutional and individual investors.


<PAGE>




NOTE E - STOCKHOLDERS' EQUITY (continued)

On August 11, 1994 the Company created a stock bonus program for employees based
upon merit and years of service.  The bonus was awarded in four equal  quarterly
installments in the periods ending August 1994, November 1994, February 1995 and
May 1995,  subject to an  employee's  continued  employment on the dates of each
award.  In the period  ending  February  28,  1995,  the Company  issued  38,638
restricted  shares  adjusted for the 1-for-4 reverse stock split at a total cost
of $60,844.  In the period ending  February 29, 1996,  the Company issued 29,831
restricted  shares  adjusted for the 1-for-4 reverse stock split at a total cost
of $64,129. In the period ended February 28, 1997, the Company did not issue any
stock bonus.  In the period ended  February 28, 1998,  the Company  issued 3,750
shares at a total cost of $10,325.

The Company adopted an Employee Stock Purchase Plan effective September 1, 1995.
The Employee Stock Purchase Plan is intended to qualify under Section 423 of the
Internal Revenue Code. Under the terms of the Plan, 125,000 shares are available
for purchase. The purchase price will be the lesser of an amount equal to 85% of
the fair  market  value of stock  calculated  on the lower of the average of the
stock's  closing  price for a full fiscal  quarter or the average of the stock's
closing price for the last five trading days of a fiscal quarter. In the periods
ending  February  28, 1998,  February  28, 1997 and  February  29, 1996,  11,658
shares,  7,772 shares and 2,472 shares had been  purchased  under this plan at a
total cost of $27,805, $23,626 and $7,762, respectively.

2.   Common Stock Options

In May 1993 the Company  granted  options to two officers for the purchase of an
aggregate of 125,000  shares of restricted  Common Stock at an exercise price of
$0.40 per share, adjusted for the October 1995 one-for-four reverse stock split,
through February 28, 1998. These options were exercised on January 2, 1997.

In March 1994 the Company granted options to two officers for the purchase of an
aggregate of 33,334  shares of restricted  Common Stock at an exercise  price of
$1.50 per share, adjusted for the October 1995 one-for-four reverse stock split,
through February 28, 1999. These options were exercised on January 2, 1997.

In March 1995 the Company granted options to two officers for the purchase of an
aggregate of 25,000  shares of restricted  Common Stock at an exercise  price of
$2.68 per share, adjusted for the October 1995 one-for-four reverse stock split,
through February 29, 2000.

The Company adopted an Incentive  Stock Option Plan for key employees  effective
September 1, 1995. The Incentive  Stock Option Plan is intended to qualify under
Section  422 of the  Internal  Revenue  Code.  Under the  terms of the Plan,  an
aggregate of 300,000  shares  adjusted for the 1-for-4  reverse stock split were
made  available.  The option  price  cannot be less than 100% of the fair market
value of the stock as determined by the Company's Board of Directors on the date
of the grant of the  option.  As of  February  28,  1997,  there were no options
granted or exercised.  As of February 28, 1998,  there were 169,600 shares under
option  granted at $3.00 per share vesting over a four year period  beginning on
February 9, 1999.

The Company  adopted an Independent  Director's  Stock  Incentive Plan effective
September 1, 1995. Under the terms of the Plan, only non-qualified stock options
and stock  awards may be granted  and an  aggregate  of 50,000  shares were made
available.  The option price is determined by a Committee of three disinterested
persons  appointed by the Board of Directors on the date of grant of the option.
As of February  28,  1997,  there were no options  granted or  exercised.  As of
February 28,  1998,  there were 35,000  shares under option  granted at $2.50 to
$3.00 per share.

NOTE F - REVERSE STOCK SPLIT

On August 31, 1995 the shareholders  approved a one-for-four reverse stock split
of the  Company's  $.001 par value  common  stock.  The reverse  stock split was
effective as of October 16, 1995. All references in the  accompanying  financial
statements to the per share amounts and earnings per share have been restated to
reflect the reverse stock split for all periods presented.

NOTE G - MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK

For the  fiscal  year  ending  February  28,  1998,  the  Company  had two major
customers accounting for sales of $1,087,409 and $851,882, respectively.

As of February 28, 1998,  the Company had $579,318 on deposit at First  National
Bank of Long Island and $180,596 on deposit at Fleet Bank.

NOTE H - SEGMENT REPORTING

For the purpose of determining  operating  segments,  Market Guide has separated
CreditRisk Monitor (formed in September 1996) from Market Guide.

The Market  Guide  segment  consists of sales made to the  Institutional,  Quote
Terminal,  and  Individual  Investor  marketplaces.  Additionally,  revenues are
generated from a print product, customized screens, data and report sales to the
corporate and institutional marketplaces and direct sales on the internet.

The CreditRisk  Monitor (CRM) segment includes all business derived from selling
CreditRisk Monitor services on the Internet (www.creditriskmonitor.com). The CRM
service is a  subscription-based  credit monitoring service targeted towards the
corporate credit manager. This business has little in common with Market Guide's
core business which remains selling reports and data to the Institutional, Quote
Terminal and Individual Investor marketplaces. Therefore, management has decided
to treat CRM as a  separate  operating  entity  and to  evaluate  its  financial
performance based on expenses that are directly attributable to this division.

There has been no allocation of Market Guide data costs,  corporate overhead, or
personnel costs to CRM in the segment analysis.



<PAGE>

<TABLE>

NOTE H - SEGMENT REPORTING (continued)
<CAPTION>

                                        12 months ended February 28, 1998               12 months ended February 28, 1997
                                        CreditRisk     Market Guide   Consolidated      CreditRisk     Market Guide   Consolidated

<S>                                             <C>            <C>            <C>            <C>            <C>             <C>
    
Revenues
Database vendor                         $         -    $5,079,380     $5,079,380        $      -       $4,150,777      $4,150,777
Market Guide products                        298,993    1,470,612      1,769,605               -          563,788         563,788
Print products                                    -        50,992         50,992               -           61,853          61,853

Total revenues                               298,993    6,600,984      6,899,977               -        4,776,418       4,776,418

Expenses
Salaries & benefits                          802,128    3,349,401      4,151,529           8,525        2,683,538       2,692,063
Database & product costs                      91,957      368,962        460,919           8,812          386,405         395,217
General & admin.                              75,518    1,002,719      1,078,237          15,552          717,535         733,087
Depreciation                                  35,747      337,578        373,325           5,734          222,842         228,576
Amortization                                  71,938      357,860        429,798               -          288,072         288,072
Advertising & promo.                         167,250      160,304        327,554          33,788          105,173         138,961

Total expenses                             1,244,538    5,576,824      6,821,362          72,410        4,403,566       4,475,976

Operating income (loss)                 $   (945,545)  $1,024,160     $   78,615        $(72,410)      $  372,852       $ 300,442


Accounts receivable                     $    234,970   $  812,479     $1,047,449        $      -       $  557,415       $ 557,415
Prop., plant & equip., net                   193,852    1,335,418      1,529,270          108,062       1,098,942       1,207,004
Capitalized assets, net                      516,260    2,263,868      2,780,128          391,976       1,499,645       1,891,621
Unearned revenue                             450,030      549,919        999,949               -          248,679         248,679

</TABLE>


<PAGE>


 NOTE I - SELECTED QUARTERLY FINANCIAL DATA (Unaudited)

Selected  quarterly  financial  data for the years ended  February  28, 1998 and
  February 28, 1997 are presented in the following table:

<TABLE>


<CAPTION>
                                                                  Three Months Ended
                                     May 31, 1997      August 31, 1997        November 30, 1997         February 28, 1998

<S>                               <C>                  <C>                 <C>                         <C>
Total revenues                    $     1,446,013      $     1,679,313     $        1,743,295          $        2,031,356
Operating income                         (61,952)             (33,078)                 35,095                     138,550
Income before taxes                      (74,529)             (47,189)                 17,493                     118,136
Net income                               (74,529)             (49,189)                 17,493                     112,862
Basic earnings per share          $        (0.02)      $         (0.01)    $             0.00           $           0.02
Basic weighted average number
of shares outstanding                   4,708,203            4,709,801              4,713,709                   4,718,440
Diluted earnings per share      $           (0.02)     $        (0.01)     $             0.00           $            0.02
Diluted weighted average
number of shares outstanding             4,733,203           4,737,084              4,753,709                   4,800,573

                                      May 31, 1996     August 31, 1996        November 30, 1996         February 28, 1997
Total revenues                    $      1,131,106     $     1,117,148     $        1,256,688            $      1,271,476
Operating income                           150,374              45,068                124,052                    (19,052)
Income before taxes                        139,032              38,092                108,874                    (30,020)
Net income                                 137,712              37,442                107,341                    (24,166)
Basic earnings per share          $           0.03     $          0.01     $             0.03            $         (0.01)
Basic weighted average number
of shares outstanding                    4,188,272           4,192,088              4,195,172                   4,428,238
Diluted earnings per share        $           0.03     $          0.01     $             0.02            $           0.00
Diluted weighted average
number of shares outstanding             4,371,701           4,375,517              4,378,601                   4,509,568



</TABLE>