Intangibles and Opportunities - by Eric Mitchell

The commercial markets are generally trending upward, but the selectivity of the market will continue to cause heartburn for a lot of breeders. If a horse isn’t “ticking all the boxes,” then buyers are apparently more inclined to walk away than take a chance.

One symptom of a selective market is a rising buy-back rate, which we are seeing at the ongoing Keene-land November breeding stock sale. Through the first seven sessions the cumulative buy-back rate of 27.7% is up significantly from 2014’s 22%. The buy-back rate rose for the Keeneland September yearling sale, as well, to 24.3% from 21.8% the previous year.

At times like these, it is worth remembering how many good racehorses—stakes horses—have been sold at relatively reasonable prices or have fallen through the cracks in the commercial trading floor.

Among the 39 horses that won or placed in the recent Breeders’ Cup World Championships, 23 were offered at auction as yearlings.

Stakes winner Swipe, who has placed second in three grade I stakes including the Sentient Jet Breeders’ Cup Juvenile, sold for $5,000 deep into the last week of the 2014 Keeneland September yearling sale. Bred on a $10,000 stud fee, Swipe is one that fell through the cracks for his breeder. Trainer Keith Desormeaux was the fortunate one to catch him and bought the colt out of the Blandford Stud consignment for Matt Bryan’s Big Chief Racing. The son of Birdstone has never been out of the money in seven starts and has earned more than $600,000 to date.

Swipe was the least expensive yearling purchase among this year’s Breeders’ Cup winners and placers. The most expensive as a yearling is Irish-bred Alice Springs, a 2-year-old daughter of top international sire Galileo. She sold for 550,000 guineas (US$928,736) to Coolmore’s M.V. Magnier. The filly finished second in the Breeders’ Cup Juvenile Fillies Turf (gr. IT).

One way to evaluate the overall value of Breeders’ Cup stakes horses as yearlings is to discount the extremes. Without the highest and lowest prices considered, the average yearling price of a Breeders’ Cup stakes horse is just shy of $180,500. The yearling prices ranged from $15,000—paid for multiple grade I winner Private Zone—to $800,000 for Las Vegas Breeders’ Cup Dirt Mile (gr. I) winner Liam’s Map.

Ten of the Breeders’ Cup stakes horses sold for less than $100,000 as yearlings and six sold for under $50,000. Longines Breeders’ Cup Distaff (gr. I) winner Stopchargingmaria was a $3.15 million buy-back at the 2014 Fasig-Tipton Kentucky November sale but she could have been had for $47,000 at the 2012 Keeneland September sale. Others that sold for less than $50,000 as yearlings include multiple graded stakes winner Stellar Wind, who sold for $40,000 and was second in the Distaff; grade III winner Airoforce, who sold for $20,000 and finished second in the Breeders’ Cup Juvenile Turf (gr. IT); grade II winner Dothraki Queen brought $35,000 as a yearling and finished third in the 14 Hands Winery Breeders’ Cup Juvenile Fillies (gr. I); and Green Mask was bought for $37,000 and has placed in two grade I races, including a third in the TwinSpires Breeders’ Cup Turf Sprint (gr. IT).

Airoforce and Green Mask could be found later in the Ocala Breeders’ Sales Co.’s April 2-year-olds in training sale, where they sold for $350,000 and $150,000, respectively. At the same sale you could have also picked up stakes winner Lady Shipman, who was bought back for $35,000 by her breeder Randall Lowe. The daughter of Midshipman had worked an eighth of a mile in a remarkable 9.4 seconds, the co-fastest of the day. Lady Shipman is not a big filly but something else apparently went awry at the sale and she failed to meet her reserve. A bad day at the sale turned out to be a good day for Lowe, who now races her under the name Ranlo Investments. Under the care of trainer Kathleen O’Connell, the filly has never finished out of the money, having won eight times in 12 starts. Her earnings to date total $538,800. Lady Shipman finished second in the Turf Sprint.

While Lady Shipman might not have a lot of size, she has a ton of heart, which is one of those intangibles that horsemen can’t measure but can get a glimpse of in the way a horse walks, can see in the manner a horse adapts to the pressure and commotion of a sale, or simply catch from a look in the eye.

Prices are certainly more subdued during the second week of Keeneland November because most of the heavy-hitters have gone, but don’t worry because they left plenty of opportunities behind.

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