Daily Racing Form National Digital Edition
BUYERS OFTEN PLACE POTENTIAL ABOVE PROVEN
The Keeneland September sale, the largest market in the world for yearlings, is a major target for commercial breeders. High up on any consignor’s list of offerings are yearlings by first-crop sires. Consignors love young sires. And so do buyers, who love potential. It’s like the NBA draft, where potential is often valued more than experience.
This year’s Keeneland September sale catalog is typical – there is an abundance of yearlings by first-crop sires. In fact, almost one-quarter of all offerings – 23.1 percent to be exact – are by first-crop sires (1,049 of the 4,538 hips cataloged).
At the Keeneland September sale, there are 41 sires whose first foals are yearlings, and 17 have 30 or more progeny in the sale, with six of those having 50 or more – American Pharoah, 81; Carpe Diem, 72; Constitution, 69; Honor Code, 64; Palace Malice, 63; Liam’s Map, 62; and Tonalist, 50. The reason they have so many foals, of course, is they are the most commercial stallions in the North American class for the 2016 breeding season, and they, not coincidentally, own the highest stud fees of the group.
This large representation of yearlings can be problematic for consignors, as their offering will be compared to dozens and dozens of other yearlings by the same sire at the sale. But consignors in the modernday, big-book era know what they are up against and make adjustments.
“It’s realistic to be concerned about yearlings by the same sire competing against one another for auction popularity,” said Allaire Ryan, director of sales for Lane’s End, which will have four of its stallions with first foals as yearlings this year – Honor Code, Liam’s Map, Mr Speaker, and Tonalist. “But it’s an everyday occurrence for all stallions, and we simply work to place each individual in the sale session that suits them best. Whether it’s Book 1 or Book 4, we place them where they will hold their own ground and just have to hope the buyers show their support.
“For a young sire starting out, I think there will always be buyer support for those that throw good physicals. When lookers have confidence in the physicals they’re inspecting, especially if a stallion is consistent in what he throws, they have confidence buying a yearling by a firstyear sire.”
This approach is shared by other major consignors. WinStar, which stands 21 stallions and is always among the nation’s annual leaders in number of mares covered by its stallions, also has four stallions whose first foals are yearlings – Carpe Diem, Commissioner, Constitution, and Daredevil.
“I think the same challenges that face consignors with yearlings by a young sire are the same that affect them with proven sires,” said Liam O’Rourke, director of season sales for WinStar, based in Versailles, Ky. “It’s so cliché, but if you have what they want you will be rewarded and if you don’t it’s very tough. Supply seems like it’s been creeping up again with the freshman sires, but that’s probably a sign of good market. We have four freshman yearling sires and are bullish going into September.”
While competition has its challenges, O’Rourke also sees opportunity and value in such sires.
“Young sires represent opportunity for both breeders and buyers alike,” O’Rourke said. “There are certain programs that prefer proven sires over young sires. However, buyers seem to be particularly interested in judging new stock that is coming onto the market, so, in turn, young sires will receive plenty of attention at the sales.
“You have to keep in mind that all proven sires were once young and unproven. Like in all business, it pays dividends to be ahead of the curve. [Eventual leading sire] Distorted Humor had Grade 1 winners Funny Cide and Awesome Humor go through the ring as first-crop yearlings, as did Speightstown with Haynesfield and Lord Shanakill.”
To date, the most commercial first-crop stallions of 2018 have been well received by buyers at sales, both last year when their progeny were weanlings and this year through the selected yearling sales this summer.
One of the best-received young sires has been Honor Code (for a look at firstcrop sire American Pharoah, see the article elsewhere in this issue). Buyers and breeders have been high on Honor Code ever since he retired from racing as a champion, hoping he will be able to carry on the legacy of his sire, the great A.P. Indy. Buyers have been enthusiastic about his progeny thus far.
Honor Code, who stands for a fee of $40,000, had nine weanlings sell at auction last year for an average of $192,778. This year, 13 yearlings by Honor Code have gone through sales rings for an average price of $280,769, with a high price of $850,000 at the Saratoga select sale. The yearling average thus far is seven times the stud fee, an excellent rate, since commercial breeders normally seek a ratio of four times stud fee to be profitable.
“The Honor Codes have been very well supported by the market thus far, and it’s credit to the quality of his offspring,” Ryan said. “Through and through, they have quality from the way they look to the way they conduct themselves to the way they move. They can come in different sizes and shapes, but they all have a lot of natural athleticism.
“In my opinion, the Honor Codes strongly resemble either A.P. Indy or Storm Cat. He’s got a number of flashy
individuals like himself in his first crop, but I’ve been amazed by the physical appearances lent by the grandsires.”
Lane’s End also will be represented by Liam’s Map in the sale. Liam’s Map, by Unbridled’s Song, stands for a fee of $25,000 and has had a large book of mares each year. The winner of the 2015 Breeders’ Cup Dirt Mile has had 17 yearlings sell this year for an average price of $155,018, or 6.2 times stud fee, with a high price of $300,000, following up on a strong weanling average of $142,500 for 12 sold.
“Liam has absolutely been stamping his foals,” Ryan said. “He gets you a wellmade, very balanced individual with a smooth, sporty shape. Overall, they are a group with a lot of style. For that reason, his yearlings have been on all sort of buyers’ lists, from end users to pinhookers.”
First-year sire Carpe Diem, by Giant’s Causeway and a winner of Grade 1 races at 2 and 3, stands for a fee of $25,000 at WinStar and has been well patronized by breeders. His popularity is due, in part, to his conformation – he himself was a $1.6 million purchase at a 2-year-olds in training sale – and he is a half-brother to three stakes winners and out of a stakeswinning mare.
At auction, Carpe Diem has had 17 weanlings sell for an average of $120,824, and this year, 13 yearlings by the stallion have sold for an average of $175,038, or seven times stud fee, with a high price of $475,000.
“Carpe Diem has been very well received in an above-average group of freshman sires,” O’Rourke said. “He had nine six-figure weanlings in November – more than any first-crop sire. The positive response has continued this year as he sits third among freshman sires by average and with a stronger ROI than the two ahead of him.
“We have felt strongly about his foals from Day 1. He’s been well supported by the syndicate with very strong mares. He’s getting a consistent type – strongbodied, forward-looking, with plenty of leg. Carpe Diem was a star in the sales ring and carried it onto racetrack performance. We expect the same from his early crops.”
WinStar stallion Constitution, who also stands for a fee of $25,000, is by leading sire Tapit and won the Florida Derby in 2014. He has had 21 yearlings sell for an average of $70,833, after 15 weanlings sold in 2017 for an average of $80,467.
“Constitution has been well received early in his commercial career,” O’Rourke said. “His first in-foal mares were in huge demand. His first weanlings made a strong debut last year. As yearlings, again, we saw many of the top judges going after his progeny in Saratoga and in July, so we’ve got a great confidence going into September.
“Constitution himself was a [$400,000] Saratoga yearling who went on to great achievements on the racetrack. In his young stock, we’ve seen that clean, efficient build that he has himself. Length and balance seem to be a trait.”