SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the quarterly period ended:    June 30, 1998

                                       OR

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

                           Commission File No.: 1-7986

                          Kent Financial Services, Inc.
        (Exact name of small business issuer as specified in its charter)


        Delaware                                                   75-1695953
(State or other jurisdiction of                                (I.R.S. Employer
incorporation or organization)                               Identification No.)


           376 Main Street, P.O. Box 74, Bedminster, New Jersey 07921
                    (Address of principal executive offices)


                                 (908) 234-0078
                           (Issuer's telephone number)

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the issuer was required to file such  reports),  and (2) has
been subject to such filing requirements for the past 90 days. Yes X No _____

     State the number of shares  outstanding of each of the issuer's  classes of
common stock:  As of July 31, 1998,  the issuer had 999,482 shares of its common
stock, par value $.10 per share, outstanding.

     Transitional Small Business Disclosure Format (check one). Yes _____ No X



<PAGE>



PART I  - FINANCIAL INFORMATION
Item 1. - Financial Statements




<TABLE>

                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                                     ASSETS

                                   (UNAUDITED)

                                 ($000 Omitted)

<CAPTION>

                                                              June 30,
                                                               1998
                                                             ---------
<S>                                                           <C>
Cash and cash equivalents                                      $ 9,449
U.S. Treasury Securities                                         1,366
Securities owned                                                 2,556
Receivable from clearing broker                                    601
Property and equipment:
  Land and building                                              1,440
  Office furniture and equipment                                   248
                                                               -------
                                                                 1,688
  Accumulated depreciation                                    (    447)
                                                               -------
  Net property and equipment                                     1,241
                                                               -------
Other assets                                                       317
                                                               -------
       Total assets                                            $15,530
                                                               =======


</TABLE>

          See accompanying notes to consolidated financial statements.






                                  


<PAGE>


<TABLE>


                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                   (UNAUDITED)

                                 ($000 Omitted)



                                                                  June 30,
                                                                   1998
                                                                ----------
<S>                                                             <C>
Liabilities:
   Securities sold, not yet purchased                            $   376
   Accounts payable and accrued expenses                           1,448
   Long-term debt                                                    502
   Discontinued operations                                           408
                                                                 -------
        Total liabilities                                          2,734
                                                                 -------

Stockholders' equity:
   Preferred stock without par value, 500,000
     shares authorized; none outstanding                               -
   Common stock, $.10 par value, 4,000,000
     shares authorized; 999,557 outstanding                          100
   Additional paid-in capital                                     15,136
   Accumulated deficit                                          (  2,440)
                                                                 -------
        Total stockholders' equity                                12,796
                                                                 -------
        Total liabilities and stockholders' equity               $15,530
                                                                 =======


</TABLE>


          See accompanying notes to consolidated financial statements.

<PAGE>


<TABLE>

                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

                      ($000 Omitted, except per share data)
<CAPTION>


                                                           Three Months Ended
                                                                June 30,
                                                        ------------------------
                                                         1998              1997
                                                        ------            ------
<S>                                                     <C>              <C>
Revenues:
     Brokerage commissions and fees                     $  491            $  350
     Principal transactions:
       Trading                                             138               420
       Investing gains (losses)                            447           (    91)
     Interest, dividends and other                         250               222
                                                        ------            ------
                                                         1,326               901
                                                        ------            ------

Expenses:
     Brokerage                                             467               530
     General, administrative and other                     584               456
     Interest                                               71                73
                                                        ------            ------
                                                         1,122             1,059
                                                        ------            ------

Earnings (loss) before income taxes                        204           (   158)
Provision (benefit) for income taxes                        93           (    18)
                                                        ------            ------
Net earnings (loss)                                     $  111           ($  140)
                                                        ======            ======

Basic net earnings (loss) per
  common share                                          $  .11           ($  .14)
                                                        ======            ======

Diluted net earnings (loss) per
  common share                                          $  .11           ($  .14)
                                                        ======            ======

Weighted average number of common
  shares outstanding (in 000's)                          1,003             1,031
                                                        ======            ======

</TABLE>


          See accompanying notes to consolidated financial statements.

                                                         

<PAGE>

<TABLE>


                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

                      ($000 Omitted, except per share data)

<CAPTION>


                                                            Six Months Ended
                                                                June 30,
                                                        ------------------------
                                                         1998              1997
                                                        ------            ------
<S>                                                     <C>              <C>
Revenues:
     Brokerage commissions and fees                     $1,013            $  773
     Principal transactions:
       Trading                                             355               785
       Investing gains (losses)                          1,567           (   572)
     Interest, dividends and other                         497               420
                                                        ------            ------
                                                         3,432             1,406
                                                        ------            ------

Expenses:
     Brokerage                                             949             1,056
     General, administrative and other                   1,536               961
     Interest                                              129               125
                                                        ------            ------
                                                         2,614             2,142
                                                        ------            ------

Earnings (loss) before income taxes                        818           (   736)
Provision (benefit) for income taxes                        53           (    65)
                                                        ------            ------
Net earnings (loss)                                     $  765           ($  671)
                                                        ======            ======

Basic net earnings (loss) per
  common share                                          $  .76           ($  .65)
                                                        ======            ======

Diluted net earnings (loss) per
  common share                                          $  .76           ($  .65)
                                                        ======            ======

Weighted average number of common
  shares outstanding (in 000's)                          1,007             1,037
                                                        ======            ======


</TABLE>



          See accompanying notes to consolidated financial statements.



                                                           

<PAGE>

<TABLE>


                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

                                 ($000 Omitted)
<CAPTION>

                                                            Six Months Ended
                                                                June 30,
                                                        ------------------------
                                                         1998              1997
                                                        ------            ------
<S>                                                    <C>               <C>          
Cash flows from operating activities:
     Net earnings (loss)                                $  765           ($  671)
     Adjustments:
       Depreciation and amortization                        24                30
       Change in unrealized (gains)
         losses on securities owned                    (   923)              586
       Change in securities owned
         and U.S. Treasury Securities                    3,068             2,307
       Change in receivable from
         clearing broker                               (   531)          (   462)
       Change in accounts payable and
         accrued expenses                                  430           (   342)
       Other, net                                      (    42)          (    35)
                                                        ------            ------
       Net cash provided by
         operating activities                            2,791             1,413
                                                        ------            ------

Cash flows from investing activities:
     Purchase of property and equipment                (    11)          (    16)
                                                        ------            ------
       Net cash used in investing
         activities                                    (    11)          (    16)
                                                        ------            ------

Cash flows from financing activities:
     Purchase of common stock                          (    83)          (   121)
     Payments on debt                                  (    16)          (    16)
                                                         ------           ------
       Net cash used in financing
         activities                                    (    99)          (   137)
                                                        ------            ------
Net increase in cash and cash
  equivalents                                            2,681             1,260
Cash and cash equivalents at
  beginning of period                                    6,768             7,109
                                                        ------            ------

Cash and cash equivalents at end of
  period                                                $9,449            $8,369
                                                        ======            ======

Supplemental disclosure of cash flow 
  information:
    Cash paid for:
      Interest expense                                  $  129            $  125
                                                        ======            ======
      Taxes                                             $   24            $  142
                                                        ======            ======

</TABLE>


          See accompanying notes to consolidated financial statements.

                                                       

<PAGE>



                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JUNE 30, 1998 AND 1997

                                   (Unaudited)



1.   Basis of Presentation
     ---------------------

     The  accompanying  unaudited  consolidated  financial  statements  of  Kent
Financial  Services,  Inc. and subsidiaries  (the "Company") as of June 30, 1998
and for the three and six month periods ended June 30, 1998 and 1997 reflect all
material adjustments  consisting of only normal recurring  adjustments which, in
the opinion of management,  are necessary for a fair presentation of results for
the interim periods. Certain information and footnote disclosures required under
generally accepted accounting principles have been condensed or omitted pursuant
to the rules and regulations of the Securities and Exchange Commission, although
the Company  believes that the  disclosures are adequate to make the information
presented not misleading. These consolidated financial statements should be read
in conjunction  with the year-end  consolidated  financial  statements and notes
thereto  included  in the  Company's  Annual  Report on Form 10-KSB for the year
ended December 31, 1997 as filed with the Securities and Exchange Commission.

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

     Prior years financial  statements have been  reclassified to conform to the
current year's presentation.

     The results of  operations  for the three and six month  periods ended June
30, 1998 and 1997 are not  necessarily  indicative of the results to be expected
for the entire year or for any other period.

2.   Business
     --------

     The Company's  business is comprised  principally of the operation of T. R.
Winston  &  Company,  Inc.  ("Winston"),   a  wholly-owned  subsidiary,  and the
management  of Asset  Value Fund  Limited  Partnership  ("AVF"),  an  investment
partnership  whose  primary  purpose is to make large  investments  in a limited
number of portfolio companies whose securities are considered undervalued by the
partnership's management.  Winston is a licensed securities broker-dealer and is
a member of the National Association of

                                          

<PAGE>



Securities Dealers, Inc. and the Securities Investor Protection Corporation. All
safekeeping,   cashiering,  and  customer  account  maintenance  activities  are
provided by an unrelated broker-dealer under a clearing agreement.

     Pursuant to the net  capital  provisions  of Rule 15c3-1 of the  Securities
Exchange Act of 1934,  Winston is required to maintain  minimum net capital.  At
June 30, 1998, Winston had net capital, as defined,  of approximately  $610,000,
which was $510,000 in excess of the required minimum.

3.   Securities Owned and Securities Sold, Not Yet Purchased
     -------------------------------------------------------

     Substantially  all  securities  are  owned  by AVF and  consist  of  equity
securities valued at market value.


4.   Net Earnings (Loss) Per Common Share
     ------------------------------------

     Net  earnings  (loss) per common share is  calculated  in  accordance  with
Statement of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS
No. 128") and is based on the  weighted  average  number of shares  outstanding.
Diluted  earnings per share includes the assumed  conversion of shares  issuable
upon  exercise of options  where  appropriate.  Prior years'  earnings per share
information has been restated to comply with the requirements of SFAS No. 128.

<PAGE>



Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations
          -------------------------------------------------

Liquidity and Capital Resources
-------------------------------

     Kent Financial  Services,  Inc. (the "Company") had  consolidated  cash and
cash equivalents  (U.S.  Treasury bills with an original maturity of ninety days
or less) of $9.4  million at June 30, 1998.  At the same date,  the company also
had U.S.  Treasury  Securities with an original maturity greater than 90 days of
$1.4  million  and  securities  owned  of $2.6  million.  See Note 3 of Notes to
Consolidated  Financial  Statements for additional  information on the valuation
and composition of securities owned.

     Net cash  provided by  operations  was $2.8 million and $1.4 million in the
six months ended June 30, 1998 and 1997, respectively. Cash flow from operations
for the six months ended June 30, 1998 increased  from the comparable  period in
1997  principally  from net income, the change in accounts  payable  and accrued
expenses  and the  change  in  securities  owned and U.S.  Treasury  Securities,
partially offset by the change in unrealized gains/losses on securities owned.

     Net cash used in financing  activities  of $99,000 and $137,000 for the six
month periods ended June 30, 1998 and 1997,  respectively,  resulted principally
from the Company's purchase and retirement of its common stock and the continued
payments on the  mortgage  loan.  The Company  believes  that its  liquidity  is
sufficient for future operations.

Material Changes in Results of Operations
-----------------------------------------

     The Company had net income of $111,000,  or $.11 basic  earnings per share,
for the three months  ended June 30, 1998  compared to a net loss of $140,000 or
$.14 basic loss per share, for the comparable  quarter in 1997. Diluted earnings
(loss) per share were $.11 and ($.14) for the  quarters  ended June 30, 1998 and
1997,  respectively.  For the six  months  ended June 30,  1998,  net income was
$765,000 or $.76 basic earnings per share, compared to a net loss of $671,000 or
$.65 basic loss per share,  for the  comparable  period in the prior  year.  The
diluted  earnings (loss) per share was $.76 and ($.65) for the six month periods
ended June 30, 1998 and 1997, respectively.

     Total  brokerage  income  (consisting  of brokerage  commissions,  fees and
trading gains) for the three months ended June 30, 1998 was $629,000, a decrease
of $141,000, or 18%, from approximately  $770,000 in the comparable 1997 period.
Total brokerage  income was $1,368,000 for the six months ended June 30, 1998, a
decrease of $190,000 or 12% from  $1,558,000 for the six month period ended June
30, 1997. Brokerage expenses (including all fixed and variable

                                                           

<PAGE>



expenses)  decreased by $63,000, or 12%, from $530,000 in the quarter ended June
30, 1997,  to $467,000  for the three  months  ended June 30, 1998.  For the six
months  ended June 30,  1998,  brokerage  expenses  were  $949,000  compared  to
$1,056,000 for the  comparable  period in the prior year, a decrease of $107,000
or 10%.  Net  brokerage  income of $162,000  for the three months ended June 30,
1998 decreased from $240,000 for  the same period in 1997, a decrease of $78,000
or 33%. For the six month period ended June 30, 1998,  net brokerage  income was
$419,000,  compared  to  $502,000  for the six  months  ended June 30,  1997,  a
decrease of $83,000 or 17%.

     The decrease in total brokerage  income,  total  brokerage  expense and net
brokerage  income for the quarter and six months ended June 30, 1998 compared to
the  comparable  periods  of 1997 was due to a decrease  in the total  number of
brokers employed at T. R. Winston & Company,  Inc.  ("Winston") in 1998 compared
to 1997.  This  decrease  was  partially  offset  by net  commissions  earned of
$135,000 from a private placement of debt for a publically traded company in the
first quarter of 1998.

     Net  investing  gains were  $447,000 and  $1,567,000  for the three and six
months ended June 30, 1998,  respectively,  compared to net investing  losses of
$91,000 and $572,000  for the  comparable  periods in 1997.  The increase in net
investing  gains from the three and six month periods ended June 30, 1997 to the
comparable periods in 1998 reflected the sale in 1998 of a significant amount of
securities  owned.  Securities owned decreased from $5.7 million at December 31,
1997 to $2.6 million at June 30, 1998.

     Interest,  dividends  and other  income was  $250,000  and $497,000 for the
three and six months ended June 30, 1998, respectively, compared to $222,000 and
$420,000 for the three and six months ended June 30,  1997,  respectively.  This
increase  was a  result  of  higher  invested  balances  due to  the  previously
discussed sale of marketable securities.

     General and  administrative  expenses  were  $584,000  and $456,000 for the
quarters ended June 30, 1998 and 1997, respectively,  an increase of $128,000 or
28%. The increase in general and  administrative  expense for the quarter  ended
June 30,  1998 versus the quarter  ended June 30, 1997 was due  principally  to:
(i) an increased bonus accrual of $60,000;  (ii) increased consulting and travel
expenses of $19,000  incurred  in  connection  with the search for new  business
opportunities; (iii) legal fees and other expenses incurred in connection with a
proxy solicitation in one of the securities owned by the company of $15,000; and
(iv) various other expenses such as postage, supplies and subscriptions.

     

                                                          

<PAGE>



     For the six  month  periods  ended  June 30,  1998 and  1997,  general  and
administrative  expenses were $1,536,000 and $961,000 respectively,  an increase
of $575,000 or 60%. This increase forthe six months ended June 30, 1998 compared
to the same  period  in 1997 is  principally  due to the  following  items:  (i)
$130,000  provision  for  start up  costs  of a  subsidiary  that  will  provide
telephone services in the New England region; (ii) $160,000 increase in employee
bonus  accruals;  (iii)  $75,000 for legal  expenses;  (iv) $60,000  increase in
business development expenses and (v) $50,000 in expenses incurred in connection
with a proxy solicitation in one of the securities owned by the Company.

Year 2000 Matters
-----------------

     The Year 2000 Issue is the result of computer  programs being written using
two digits rather than four to define the applicable  year. Any of the Company's
computer programs that have time- sensitive  software may recognize a date using
"00" as the year 1900 rather than the year 2000.  This could  result in a system
failure or miscalculations causing disruptions of operations,  including,  among
other things, a temporary inability to process transactions or engage in similar
normal business activities.

     Management  has  determined   that  the  year  2000  issue  will  not  pose
significant  operational  problems for its internal computer systems.  All costs
associated  with this  conversion  are being  expensed as  incurred.  Due to the
critical  relationship  with the  Company's  clearing  broker,  the Company will
develop a plan to test the  transaction  and other data provided by the clearing
broker after any required  revisions to its software.  However,  there can be no
guarantee that the systems of the clearing  broker and other  companies on which
the  Company's  systems  rely  will be  timely  converted  and would not have an
adverse effect on the Company's systems.

     The Company will utilize external resources to reprogram,  or replace,  and
test  the  software  for  Year  2000  modifications.   The  Company  anticipates
completing the Year 2000 project not later than October 31, 1999, which is prior
to any anticipated impact on its operating  systems.  The total cost of the Year
2000 project is not expected to be material and will be funded through operating
cash flows, which will be expensed as incurred.

     The costs of the project and the date on which the Company believes it will
complete the Year 2000  modifications  are based on management's  best estimate,
which were derived utilizing  numerous  assumptions of future events,  including
the continued availability of certain resources, third party modifications plans
and other factors.  However, there can be no guarantee that these estimates will
be achieved and actual results could differ materially from those anticipated.
                                                         

<PAGE>



PART II - OTHER INFORMATION
-------   -----------------

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

        (a)      Exhibits
        ---      --------

        (27).      Financial Data Schedule for the six months ended June
                   30, 1998.

        (b)      Reports on Form 8-K
                 -------------------

                 No reports on Form 8-K were filed  during the quarter for which
                 this report is being filed.


                                                        

<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.

                                                   KENT FINANCIAL SERVICES, INC.




Dated: August 14, 1998                             By: /s/ Mark Koscinski
                                                       ------------------------
                                                       Mark Koscinski
                                                       Vice President