UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

                                QUARTERLY REPORT
                            UNDER SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934
                For the quarterly period ended September 30, 1997


                         Commission file number 0-19767


                       THE HOME-STAKE ROYALTY CORPORATION
        (Exact name of small business issuer as specified in its charter)


                 Oklahoma                            73-0288040
     (State or other jurisdiction of              (I.R.S. Employer
      incorporation or organization)             Identification No.)


                          15East 5th Street, Suite 2800
                             Tulsa, Oklahoma 74103
                    (Address of principal executive offices)


                                 (918) 583-0178
                          Registrant's telephone number



        Check whether the issuer (1) has filed all reports  required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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


        The number of shares outstanding of the Registrants's  common stock, all
of which  comprise a single  class with $40 par value,  as of November 13, 1997,
the latest practicable date, was 69,808.




                                       -1-

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                       THE HOME-STAKE ROYALTY CORPORATION

                                   FORM 10-QSB
                               SEPTEMBER 30, 1997

                                TABLE OF CONTENTS

                                                                           Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

        Consolidated Condensed Balance Sheets ............................    4

        Consolidated Condensed Statements of Income and Retained
          Earnings for the Nine Months ended September 30, 1997...........    5

        Consolidated Condensed Statements of Income and Retained
          Earnings for the Three Months ended September 30, 1997..........    6

        Consolidated Condensed Statements of Cash Flow ...................    7

        Notes to Consolidated Condensed Financial Statements .............    8

Item 2. Management's Discussion and Analysis .............................   10

PART II - OTHER INFORMATION

Item 1. Legal Proceedings ................................................   12

Item 2. Changes in Securities ............................................   12

Item 3. Defaults upon Senior Securities ..................................   12

Item 4. Submission of Matters to a Vote of Security Holders ..............   12

Item 5. Other Information ................................................   13

Item 6. Exhibits and Reports on Form 8-K .................................   13

SIGNATURES ...............................................................   14


                                       -2-

<PAGE>



                         PART I - FINANCIAL INFORMATION

                                       -3-

<PAGE>



                       THE HOME-STAKE ROYALTY CORPORATION
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                   (Unaudited)

                                     ASSETS

                                                   September 30,   December 31,
                                                       1997           1996
                                                       ----           ----
Current assets:
Cash and cash equivalents .......................    $   790,244    $   626,864
Accounts receivable .............................        665,286      1,469,877
Receivable from affiliate .......................        158,683         66,213
Prepaid expenses ................................        122,026        255,957
                                                     -----------    -----------
Total current assets ............................      1,736,239      2,418,911

Investments (Note 2) ............................      3,706,348      3,592,495

Property and equipment, at cost: ................     24,291,086     25,235,245
Less accumulated depreciation,
depletion and amortization ......................     15,824,663     16,437,277
                                                     -----------    -----------
Net property and equipment ......................      8,466,423      8,797,968

Other assets ....................................         23,877         24,119
                                                     -----------    -----------
                                                     $13,932,887    $14,833,493
                                                     ===========    ===========


                      LIABILITIES AND STOCKHOLDERS' EQUITY


Current liabilities:
Accounts payable and accrued liabilities ........    $   549,410    $ 1,514,282
Dividends declared ..............................         62,827         62,827
Income taxes payable ............................          6,600         75,198
Bonus Payable ...................................         37,650         20,253
Current note payable (Note 3) ...................           --          964,260
                                                     -----------    -----------
Total current liabilities .......................        656,487      2,636,820

Long-term note payable (Note 3) .................           --          401,775

Deferred income taxes ...........................        972,358        773,200

Contingencies (Note 4)

Stockholders' equity:
Preferred stock, $1 par value -
200,000 shares authorized;
none issued Common stock, $40 par value -
100,000 shares authorized and issued ............      4,000,000      4,000,000
Additional paid-in capital ......................      6,000,000      6,000,000
Retained earnings ...............................      5,668,206      4,385,862
                                                     -----------    -----------
                                                      15,668,206     14,385,862

Less treasury stock, at cost - 30,192 shares ....      3,364,164      3,364,164
                                                     -----------    -----------
Total stockholders' equity ......................     12,304,042     11,021,698
                                                     -----------    -----------
                                                     $13,932,887    $14,833,493
                                                     ===========    ===========
                             See accompanying notes

                                       -4-

<PAGE>



                       THE HOME-STAKE ROYALTY CORPORATION
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                              AND RETAINED EARNINGS
                  Nine months ended September 30, 1997 and 1996
                                   (Unaudited)



                                                         1997          1996
                                                         ----          ----

Revenues:
Oil sales .......................................    $ 3,184,587    $ 3,437,465
Gas sales .......................................      2,132,634      1,828,149
Lease bonuses and rentals .......................         72,496         19,411
Interest and dividends ..........................         32,769         51,378
Gain on sales of assets .........................        111,073         12,810
Income from equity affiliates ...................        333,541        298,896
Other ...........................................        133,433        149,957
                                                     -----------    -----------
                                                       6,000,533      5,798,066

Costs and expenses:
Lease operating expenses ........................      1,217,554      1,599,878
Production taxes ................................        431,313        473,545
Depreciation, depletion and amortization ........        914,248      1,054,179
Dry hole costs ..................................        459,016         47,064
Condemned and abandoned properties ..............         56,035         19,703
General and administrative expense ..............        833,264        579,504
Interest expense ................................         37,713        193,841
Property, franchise and other taxes .............        112,469         87,678
                                                     -----------    -----------
                                                       4,061,612      4,055,392

Income before provision for income taxes ........      1,938,921      1,742,674

Provision for income taxes:
Current .........................................        268,937        236,740
Deferred ........................................        199,158         72,675
                                                     -----------    -----------
                                                         467,095        309,415
                                                     -----------    -----------

Net income ......................................      1,470,826      1,433,259

Retained earnings at beginning of period ........      4,385,862      2,855,837

Cash dividends ($2.70 per share - 1997,
     $3.60 per share - 1996).....................       (188,482)      (251,309)
                                                     -----------    -----------

Retained earnings at end of period...............    $ 5,668,206    $ 4,037,787
                                                     ===========    ===========

Weighted average number of 
     common shares outstanding...................         69,808         69,808
                                                          ======         ======

Net income per common share......................         $21.07         $20.53
                                                          ======         ======

                             See accompanying notes.

                                       -5-

<PAGE>



                       THE HOME-STAKE ROYALTY CORPORATION
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                              AND RETAINED EARNINGS
                 Three months ended September 30, 1997 and 1996
                                   (Unaudited)



                                                       1997             1996
                                                       ----             ----

Revenues:
Oil sales .......................................    $   890,539    $ 1,139,419
Gas sales .......................................        606,743        634,680
Lease bonuses and rentals .......................         23,118          8,059
Interest and dividends ..........................         13,152         20,129
Gain (loss) on sales of assets ..................         11,365         10,042
Income from equity affiliates ...................         62,402        164,183
Other ...........................................         41,606         53,843
                                                     -----------    -----------
                                                       1,648,925      2,030,355

Costs and expenses:
Lease operating expenses ........................        438,597        562,784
Production taxes ................................        125,260        167,921
Depreciation, depletion and amortization ........        238,082        351,393
Dry hole costs ..................................         88,269            644
Condemned and abandoned properties ..............          9,520         24,784
General and administrative expense ..............        293,331        110,874
Interest expense ................................          1,627         58,144
Property, franchise and other taxes .............         25,272         22,219
                                                     -----------    -----------
                                                       1,219,958      1,298,763

Income before provision for income taxes ........        428,967        731,592

Provision for income taxes:
Current .........................................         31,927         83,440
Deferred ........................................         17,352        (20,837)
                                                     -----------    -----------
                                                          49,279         62,603
                                                     -----------    -----------

Net income ......................................        379,688        668,989

Retained earnings at beginning of period ........      5,351,346      3,431,625

Cash dividends ($ .90 per share) ................        (62,828)       (62,827)
                                                     -----------    -----------

Retained earnings at end of period ..............    $ 5,668,206    $ 4,037,787
                                                     ===========    ===========

Weighted average number of
     common shares outstanding...................         69,808         69,808
                                                          ======         ======

Net income per common share......................         $ 5.44         $ 9.58
                                                          ======         ======

                             See accompanying notes.

                                       -6-

<PAGE>



                       THE HOME-STAKE ROYALTY CORPORATION
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                  Nine months ended September 30, 1997 and 1996
                                   (Unaudited)



                                                        1997           1996
                                                        ----           ----

Operating activities:
Oil and gas sales, net of production taxes ......    $ 5,054,696    $ 4,756,669
Lease bonuses and rentals .......................         72,496         19,411
Interest and dividends ..........................         32,769         51,378
Other ...........................................        133,433        149,957
                                                     -----------    -----------
                                                       5,293,394      4,977,415

Cash paid to suppliers and employees ............      2,175,858      2,283,470
Interest paid ...................................         37,713        193,841
Property, franchise and other taxes .............        112,469         87,678
Income taxes paid ...............................        337,535        124,757
                                                     -----------    -----------
                                                       2,663,575      2,689,746
                                                     -----------    -----------
Net cash provided by operating activities .......      2,629,819      2,287,669


Investing activities:
Proceeds from sales of property and equipment ...        509,539         61,792
Acquisition of property and equipment ...........     (1,465,689)      (366,383)
Dividends from equity affiliates ................         45,506         56,818
                                                     -----------    -----------
Net cash used in investing activities ...........       (910,644)      (247,773)


Financing activities:
Note payments ...................................     (1,366,035)    (1,285,680)
Cash dividends paid .............................       (189,760)      (285,745)
                                                     -----------    -----------
Net cash used in financing activities ...........     (1,555,795)    (1,571,425)
                                                     -----------    -----------

Net increase in cash and cash equivalents .......        168,380        468,471

Cash and cash equivalents at 
     beginning of period........................         626,864        564,875
                                                     -----------    -----------

Cash and cash equivalents at end of period ......    $   790,244    $ 1,033,346
                                                     ===========    ===========








                             See accompanying notes.

                                       -7-

<PAGE>



                       THE HOME-STAKE ROYALTY CORPORATION
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

Note 1 - General

The unaudited financial  information provided in this report includes all normal
recurring  adjustments  which are, in the opinion of  management,  necessary  to
fairly  present the financial  position,  result of operations and cash flows of
the Company.  Certain information and footnote  disclosures normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles  have been  omitted  or  condensed.  The  Company  believes  that the
disclosures   herein  are  adequate  to  make  the  information   presented  not
misleading;  however,  these financial  statements should be read in conjunction
with the audited financial  statements and related notes thereto included in the
Company's Annual Report on Form 10-KSB for the year ended December 31, 1996.

The results for interim periods are not  necessarily  indicative of trends or of
results to be expected for the full year.

Note 2 - Summarized financial information of equity investees

Summarized income statement  information for the nine months ended September 30,
1997 and 1996 for The Home-Stake  Oil & Gas Company  ("HSOG") and Alden Pipeline
Company is presented below:

                                              1997              1996
                                              ----              ----
Income Statement data:
          Revenues.......................  $ 5,552,579       $ 5,475,148
          Income before income taxes.....    1,583,216         1,280,330
          Net income (1).................    1,154,139         1,087,582

          (1) Includes  $242,683  and  $305,481 in 1997 and 1996,  respectively,
          attributable to the equity earnings of the Company recorded by HSOG.

During the first  quarter of 1997,  the  Company  sold its  interest in the N.E.
Alden Field,  including Alden Pipeline Company.  This sale was effective January
1, 1997.  Accordingly,  the 1997  information  presented  above does not include
amounts  attributable  to the  operations  of Alden  Pipeline  Company;  amounts
included for 1996 operations are not material to the totals shown.

Note 3 - Note payable

On May 31, 1997, the Company paid off-its bank note payable which was due May 1,
1998. The Company has a line of credit in the amount of $700,000 available until
May 1, 1998,  which provides for monthly payments of interest on the outstanding
borrowings at bank prime.  There is no balance currently  outstanding under this
line, however the Company has issued a letter of credit in the amount of $60,000
which is guaranteed by this line.

The note  payable  and line of  credit  described  above are  collateralized  by
certain of the Company's producing properties.

Note 4 - Contingencies

The  Company is involved in various  other legal  actions  arising in the normal
course of business. In the opinion of management, the Company's liabilities,  if
any, in these matters will not have a material effect on the Company's financial
position or the results of operations.

                                       -8-

<PAGE>



Item 2.     Management's Discussion and Analysis.

Results of  Operations  - First  nine  months of 1997  compared  with first nine
months of 1996

Net income for the first nine months increased $37,567,  from $1,433,259 in 1996
to $1,470,826 in 1997. The principal reasons for this increase are as follows:

Oil sales  decreased 7%  ($252,878) as a result of a decrease in the average oil
price from $19.17 per barrel to $19.06 per barrel,  coupled  with an decrease in
production  volumes of 12,287 barrels.  This decrease in production  volumes was
primarily a result of property dispositions during 1996 and early 1997.

Gas sales  increased  $304,485 (17%) due to an increase in the average gas price
per mcf from $1.98 in 1996 to $2.33 in 1997,  partially  offset by a decrease in
production volumes from 923,324 mcf in 1996 to 913,979 mcf in 1997.

Lease rentals and bonuses  increased  $53,085 due to higher leasing  activity in
1997 than in 1996.

Gains on sales of assets increased $98,263 in 1997, following the Company's sale
of their  interest in the N.E.  Alden Field.  There were no comparable  sales in
1996.

Income from equity affiliates increased $34,645 in 1997. The Company's principal
equity  investee,  The  Home-Stake  Oil & Gas  Company,  reported  net income of
$1,154,139 in 1997 and  $1,103,662 in the same period of 1996. In addition,  the
Company's  ownership in The Home-Stake Oil & Gas Company increased from 31.7% to
33.9% in November 1996.

Lease operating  expenses  decreased  $382,324 (24%) from 1996. This decrease is
principally   attributable  to  environmental   remediation   expenses  in  1996
associated  with a  waterflood  property  in which the  Company has a 9% working
interest,  coupled  with an insurance  reimbursement  in 1997 of certain of such
costs of approximately $145,250.

Production  taxes  decreased  $42,232  as a result  of lower  production  values
described above.

Dry hole costs  increased  $411,952 in 1997 due to the greater  incidence of dry
holes and  higher  average  costs per well.  In 1996 there were 3 dry holes (.59
net) drilled at an average gross cost of $224,350 per well; in 1997 there were 8
dry holes (1.02 net) drilled at an average gross cost of $450,016 per well.

Condemned  and  abandoned  property  expense  increased  $36,332.  1996  expense
includes salvage credits of $12,488 received on a property  abandoned during the
first  quarter.  1997 expense was also higher due to the  abandonment of acreage
costs associated with eight dry holes in 1997, compared to only three in 1996.

General and administrative expense increased $253,760.  1997 operations includes
$76,779  associated  with the  Company's  proposed  merger  with The  Home-Stake
Royalty  Corporation (see Item 5 below). In addition,  the Company added certain
full-time and contract employees in late 1996 and early 1997, in connection with
its  exploration  activities.  1996  operations  include a reduction  of $82,500
related to a settlement  agreement reached with the Company's  insurance carrier
for its officers and directors liability coverage.

Interest  expense  decreased  $156,128 in 1997,  reflecting the Company's  lower
average borrowings.

Results of Operations - Third quarter 1997 compared with third quarter 1996

Net income for the third quarter  decreased  $289,301,  from $668,989 in 1996 to
$379,688 in 1997. The principal reasons for this increase are as follows:


                                       -9-

<PAGE>



Oil sales  decreased  22%  ($248,880)  due to lower  average oil  prices,  which
decreased  from $19.60 per barrel in 1996 to $16.89 per barrel in 1997,  coupled
with a decrease in production volumes from 58,147 barrels to 52,719 barrels.

Gas sales  decreased  $27,937 (4%) due to a decrease in production  volumes from
309,663 mcf to 289,284 mcf, partly offset by slightly higher average gas prices,
which increased from $2.05 per mcf in 1996 to $2.10 per mcf in 1997.

Lease operating  expenses decreased $124,187 (22%). This decrease is principally
attributable  to  environmental  remediation  expenses in 1996 associated with a
waterflood property in which the Company has a 9% working interest, coupled with
an  insurance  reimbursement  in 1997 of certain of such costs of  approximately
$145,250.

Production  taxes  decreased  $42,661  as a result  of lower  production  values
described above.

Dry hole costs increased $87,625. There were three dry holes drilled in 1997 and
none in 1996.

General and administrative expense increased $182,457.  1997 operations includes
$56,644  associated  with the  Company's  proposed  merger  with The  Home-Stake
Royalty  Corporation (see Item 5 below). In addition,  the Company added certain
full-time and contract employees in late 1996 and early 1997, in connection with
its  exploration  activities.  1996  operations  include a reduction  of $82,500
related to a settlement  agreement reached with the Company's  insurance carrier
for its officers and directors liability coverage.

Interest  expense  decreased  $56,517 in 1997,  reflecting  the Company's  lower
average borrowings.

Financial Condition and Liquidity

The Company's operating activities have traditionally been self-financed through
internally  generated cash flows.  The principal uses of cash flows have been to
fund the Company's  exploration and production activities and for the payment of
dividends to stockholders.  The use of borrowed funds has generally been limited
to the acquisition of producing oil & gas properties  where future revenues from
such purchases are expected to fund the debt.

The  Company has a capital  expenditures  budget for 1997 of $1.7  million.  The
Company has spent  approximately  $1 million in the first three quarters of 1997
and has current  commitments of approximately  $500,000 for the remainder of the
year. In addition,  the Company is actively pursuing  acquisition  opportunities
when they arise.

Since the beginning of 1997, product prices have decreased approximately 25% for
oil and 36% for natural gas.  Despite these  decreases,  the Company  expects to
finance its budgeted 1997 drilling  activities  from  internally  generated cash
flows. In addition, the Company has a revolving line-of-credit with NationsBank,
N.A,. in the amount of $700,000  which expires May 1, 1998.  There is no balance
currently  outstanding under this line,  however the Company has issued a letter
of credit in the amount of $60,000 which is guaranteed by this line.

The  Company  does not engage,  nor does it expect to engage,  in any hedging or
other  similar  transactions  which are  intended  to manage  risks  relating to
movements in oil and natural gas prices.

The Company does not expect its costs of  addressing  the "Year 2000" problem to
be  significant.  Nor is this problem  expected to cause any  disruption  in the
operations or business activities of the Company.

Statement of Financial  Accounting  Standards No. 128,  Earnings Per Share, will
become  effective for periods ending after  December 15, 1997.  Adoption of this
statement  will  not  have  a  material  effect  on  the  Company's  results  of
operations.


                                      -10-

<PAGE>



                           Part II. Other Information

Item 1.    Legal Proceedings.

           There is a complete  discussion of legal proceedings in the Company's
           Annual  Report on Form  10-KSB for the year ended  December  31, 1996
           (the "Form 10-KSB"). Since the date of that report there have been no
           material changes in the status of such matters.

Item 2.    Changes in Securities.

           None.

Item 3.    Defaults Upon Senior Securities.

           None.

Item 4.    Submission of Matters to a Vote of Security Holders.

           None.

Item 5.    Other Information.

           At a special meeting of stockholders scheduled to be held on December
           11,  1997,  stockholders  will be  asked  to  consider  and vote on a
           proposal to approve and adopt a Merger Agreement  between the Company
           and The Home-Stake Oil & Gas Company ("HSOG"),  pursuant to which the
           Company  will be merged  with and into HSOG.  The terms of the Merger
           Agreement provide that the holders of the Company's common stock will
           receive  48.66  shares  of HSOG  new  stock  for  each  share  of the
           Company's common stock owned at the effective time of the Merger.

Item 6.    Exhibits and Reports on Form 8-K.

           (a)  Exhibits.

                The  following  documents  are included as exhibits to this Form
10-QSB.

           Exhibit
           Number          Description

           27              Financial Data Schedule

           (b) Reports on Form 8-K.

                No  reports  on Form 8-K were filed  during  the  quarter  ended
September 30, 1997.

                                      -11-

<PAGE>


                                   Signatures



In accordance with the  requirements of the Exchange Act, the Registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.


                                The Home-Stake Royalty Corporation
                                    (Registrant)


Date: November 14, 1997         By: /s/  Robert C. Simpson
                                    -----------------------------
                                     Robert C. Simpson
                                     Chairman of the Board, C.E.O.,
                                     President and Treasurer


Date: November 14, 1997         By: /s/  Chris K. Corcoran
                                    -----------------------------
                                     Chris K. Corcoran
                                     Executive Vice President,
                                     Chief Financial Officer and
                                     Corporate Secretary

                                      -12-