Stallion Watch 2008
Bridlewood Farm to be commended for not
going crazy with young promising sire's fee.
It's that time of year again where we sift through the newly announced 2008 fees and identify the best and worst values in the stallion market. If you agree or disagree with anything you see in Stallion Watch, we'd like to hear from you. To email us, click here. Today, we'll look at some of the best values among stallions standing for $7,500 or less:
1. Put It Back ($7,500 Bridlewood Farm, FL) - Hitting on all cylinders with strong numbers across the board. Progeny win at a 20% clip while over 62% of his stakes winners are graded caliber. The poster boy for performance over pedigree.
2. Pioneering ($5,000 Overbrook Farm, KY) - As tried and tested as they come, this guy simply has no holes and can't be overlooked by breeders on a budget. Graded stakes production is off the charts for a sire in this category, and he surprisingly gets a high number of durable types.
3. Memo ($6,000 Ridgeley Farm, CA) - When they hold up, Memo's progeny can knock heads with the best, whether it's in open company or against Cal-breds. Improves his mares by 34%, but you really have to breed an iron mare to him.
4. Concerto ($7,500 Ocala Stud Farm, FL) - Gets useful and durable types and more than his share of stakes caliber runners. Numbers are respectable in just about any price category, including a very healthy median earnings of $26,880.
5. Evansville Slew ($2,500 Diamond G Ranch, OK) - Doesn't get quite the number of graded stakes horses as those above, but he's not bad considering his comparable index of .95. Probably the best $2,500 sire we've seen over the last 15 years.
For an updated list of all categories, click here
Congratulations!
To Southern Equine Stables LLC on their purchase of Hip 72 for
$450,000 at the Barretts March Sale. This athletic daughter of Gulch
was purchased by ATR for just $52,000 at the Keeneland September Sale!
Hip 72 (Gulch - Ravish Me) posting the co-fastest work of 10.0 at Barretts March
Conformation vs. Catalog
Has the pendulum swung too far in favor of conformation?
Back in the mid to late 1980’s, the spending habits of D.Wayne Lukas changed the landscape of the American yearling market. Prior to his influence, American buyers focused primarily on the catalog page, with conformation a secondary consideration. Consignors with yearlings by top sires and out of a stakes producing dams could almost bank on a profitable year. Those with barren catalog pages usually came out near the bottom of the market.
The Lukas influence persists today, engrained further into the spending habits of American buyers by the growth of the pinhooking market. Pinhookers developed their own version of Lukas’ legacy, a version that drives a large portion of today’s market.
But has the overwhelming preference for conformation gone too far? Are there instances where a buyers’ passion (for the complete article, click here)
Cost-Cutting for
Commercial Breeders
With the rapid rise in North American stud fees and other forms of overhead expenses in recent years, healthy profit margins within the commercial sector of the thoroughbred industry are becoming harder and harder to come by. Investors have resolved themselves to the fact that many of their investments will yield a loss upon re-sale, and that one or two home runs will be required to save the bottom line.
When industry analysts discuss the economic dynamics within the commercial  breeding industry, it is usually done in terms of the larger numbers. And while these numbers are the biggest pieces of the pie, there are other methods for cost-cutting that can add thousands of dollars to the year end numbers of a
commercial breeding program.
"For some, the reluctance to analyze certain operational costs stems from a paradigm within the industry where certain costs are fixed and questioning them is a breach of etiquette."
Though many bloodstock investors have been able to implement effective cost-cutting methods in the corporate world, few spend the time to develop and implement similar methods into their thoroughbred investment portfolio. For some, the reluctance to analyze certain operational costs stems from a paradigm within the industry where certain costs are fixed and questioning them is a breach of etiquette. But for those investors who don’t enter the industry with large amounts of capital, failure to devise effective cost controls is more than a breach of etiquette. It can be a first class ticket out of the industry altogether.
This week, we’ll look at ways for commercial breeders to... (for the complete article, click here).
Understanding 'Value'
in Stallion Fees
Language concerning the concept of value is used freely and loosely throughout our society. Usually, such language is, at best, ambiguous, and rarely does it delve into the specifics of what defines 'value'. From automobiles to mutual funds, everyone claims to be selling something with extraordinary value, although few bother to substantiate such claims.
These days the same semantics are working overtime n the breeding industry, especially in relation to stallion markets. Industry periodicals are littered with advertising claiming a particular tallion offers mare owners extraordinary 'value' and a 'higher return on
"For the typical mare owner aiming for the sales ring
who invests $10,000 into a stud fee, the absolute minimum
threshold for profit is $26,610, after commissions are
paid to the consignor and the sales company."
investment.' Citing sales numbers and a myriad of statistics, stallion syndicates spend a lot of money trying to persuade us that there is money to be made if only we'd send our mares to their stallions.
So what exactly constitutes value in the breeding industry? And who defines it? Owners and trainers may define it in terms of winning percentages or opportunities at developing a stakes-quality runner. Commercial breeders are more likely to define value as a function of the rate of return on investment, although some of them may disagree on the specifics. As to who defines value, too often that's left to claims in stallion ads, when it could be better ascertained through a careful fiscal analysis by mare owners.
(For the complete article, click here)
| |
Breeding to Sell |
Breeding to Race |
| Stud Fee |
$10,000 |
$10,000 |
| Mare Depreciation (15%) |
$5,250 |
$5,250 |
| Board (through Sept. of yrlg year) |
$9,360 |
$9,360 |
| Breaking/Training |
|
$7,800 |
| Vet, farrier, insurance, etc. |
$2,000 |
$3,000 |
| |
|
|
| Totals |
$26,610 |
$35,410 |
BREEDING TO RACE:
THE TEN MOST COMMON MISTAKES
The science of breeding racehorses is full of pitfalls, and few will argue that even the most astute breeders have difficulty avoiding them. Those who have succeeded are able to identify these pitfalls as they relate to their particular program and implement strategies to safeguard their investments. With the breeding season upon us, there is no better time to re-visit these pitfalls and the damage they have on breeding programs. Whether they impact a racing program directly or indirectly, the effects are often lingering, and sometimes fatal. This month, we’ll look at some of the biggest mistakes made by those who breed to race. (For the complete article, click here).
UNHERALDED INFLUENCES IN
AMERICAN PEDIGREES
Northern Dancer, Mr. Prospector, and Nasrullah. Three of the most recognized and sought after influences in the history of the American bloodstock market. Revered for generations, these three stallions represent the upper echelon of genetic material found in the United States. It is through the study of these influences that most industry newcomers begin their education of American pedigree patterns.
Of course, the entire pedigree of an individual cannot be comprised entirely of these
influences. Certainly, there is room for less recognizable male influences and it is the astute breeder who can recognize more obscure, perhaps underrated influences that are sufficiently potent enough to carry their share of the genetic pattern. Though not always found in the male sire-line, these influences have proven to be valuable commodities in a variety of pedigree positions, and even though you’re unlikely to hear their names at a gathering of pedigree experts, they carry a degree of My Babu (1945)
genetic strength that can be utilized by breeders
working within the constraints of a budget. (For the entire article, click here).
The Language of Numbers
There is a language of descriptive statistics used in our industry to interpret, analyze, and at times, mislead investors. Though a full understanding of these dynamics often seems daunting, there is a core group of statistics that if understood fully, will shed light on the majority of potential pitfalls and quickly help breeders sift through the hypeand improve the performance of their bloodstock portfolio. By understanding these building blocks of the language, breeders can make significantly better decisions in all areas of their breeding program. For the purposes of this article, we’ll address eight of the more commonly used statistics.
Average Earnings Per Starter - One of the most commonly used statistics to describe the earning power of a sire’s progeny, it is also one of the least discriminating and most easily skewed of all the numbers used in stallion advertising. A very simple computation, it is derived by taking a sire’s total progeny earnings and dividing it by the number of starters. Mildly effective as a starting point for stallion evaluation, a sire’s average earnings per starter allows mare owners to get a general idea of how a sire compares to his counterparts. But because such a large portion of the stallion population
"By understanding these building blocks of the language, breeders can make significantly better decisions in all areas of their breeding program."
falls into the $25,000 - $40,000 average earnings range, this is frequently a non-descriptive statistic for sires, and tells mare owners very little. Also, this statistic is subject to being heavilyskewed by the sire’s top earner, best illustrated in the case of Skip Trial, where Skip Away accounts for nearly 30% of his total progeny earnings. Knowing this, Skip Trial’s average earnings per starter of... (click here for the entire article)
A Critical Look at Nicking
“The mythology surrounding the breeding of Thoroughbreds is pervasive. A few of
these myths are the astonishing stupidity of the dosage system, the absurd overemphasis on the female family, and the irrational belief in the validity of nicks.”
- John R. Gaines, founder of Gainesway Farm and The Breeders Cup
 Few breeding theories have permeated the psyche of the American breeder more than nicking. Nicking pundits have turned this phenomenon into a financial windfall, and more importantly, a concrete paradigm that has effectively shielded itself from critical review. Yearling buyers are not immune from this trend either, forcing many breeders to check the nick ‘rating’ as they plan their commercial matings each year. It has become a self-perpetuating cycle that shows no signs of slowing down.
While we are not willing to discard the underlying theory John R. Gaines
altogether, the current methodologies used to create the nicking
craze certainly deserve a thorough and critical look. Most will look to nicking’s close relationship with the computer and lend it credibility without applying any type of critical analysis that may uncover... (click here for the entire article)
Evaluating Soundness in a Sire's Progeny:
Use of the AEI/SI Comparison
Few issues wreak more havoc on an owner’s bottom line than the soundness of his horses. The slightest of injuries can add thousands of lay-up dollars to an owners bill, and more serious injuries that end a horse’s career can be catastrophic to an entire program. And yet, soundness in breeding stock is one of the least scrutinized topics by mare owners as they make their breeding plans each year. Traditional methods for evaluating soundness in a sire’s progeny have included percentage of starters from foals and number of starts per foal, though there hasn’t been a push to develop more advanced measures.
Another method of evaluating the durability of a sire’s progeny involves a comparing  and contrasting of his Average Earnings Index
(AEI) and Comparable Index (CI) to his Sire Index (SI) and Comparable Sire Index (ComSI). In order to understand the importance of these comparisons, it is first important to understand each statistical acronym.
The AEI was developed by the late Joseph Estes during his time as editor of The Blood Horse. A numerical index where 1.00 represents the average for the breed, the AEI tells us the earnings for any horse relative to his or her peers during the same year. In Excess (Ire)
For example, if the average earnings for a five year old mare during 2004 was $10,000, and your five year old mare had earned $15,000 during the same year, her AEI would be 1.50. The obvious flaw with the AEI is that it fails to take into account the number of starts made by each individual. Durable horses are more likely to push their AEI up simply by making more starts. Fragile horses are at a disadvantage in that their lower AEI is merely a function of fewer earnings opportunities. (click here for the entire article)
Joseph A. Estes
Much of what we do here at The American Thoroughbred Review is based on a common sense approach, utilizing raw numbers in statistically valid methods that illustrate the strengths and weaknesses of modern breeding theories. Long reaching inferences are frowned upon, and facts reign supreme over the hypothetical.
Such methodologies were also at the heart of Joseph A. Estes’
life and work. A sports journalist by trade, Estes became editor-in-chief of The Blood-Horse in 1935, and later, a breeding consultant for the powerful stables of Nelson Bunker Hunt.
“When a young horse enters the stud, he should be judged, first, by his class as a racehorse; second by his physical attributes; and third, by his pedigree."
Estes was instrumental in the development of statistical methodologies for evaluating bloodstock. It was through his efforts that the Average Earnings Index (AEI) was born, giving breeders a tool for evaluating the relative earning power of an individual. Estes also worked closely with famed Iowa State professor Dr. Jay Lush, commonly known as the father of modern quantitative genetics. Estes implemented Lush’s practical research on genetic transmission to the academic study of thoroughbred pedigrees.
Of the many adjectives used to describe Estes, popular was not one of them. Estes could be confrontational and excessively direct, often demanding that his colleagues prove their ideas, rather than merely advertise them. Estes often found himself at odds with advocates of... (click here to visit the Joseph A. Estes page).
The American Yearling Market:
Irrational Psychology Several years ago, while completing an internship at a major California breeding farm, one of my responsibilities was to show the stallions to prospective clients. One day, a gentlemen arrived at the farm who was interested in seeing a recently retired Grade 1 winner that would reportedly stand for $40,000 during the upcoming breeding season. As I led the attractive colt out of his stall, you could see the excitement develop in the man's face. Obviously contemplating the colt's potential for greatness as a sire, the man became almost giddy as he gave the colt a lookover. As we continued on our tour of the stallion barn, I asked him about his breeding program and what kind of goals he may have. He explained that he had a handful of mares at a nearby farm that he bred strictly for racing purposes. He had no plans for
"We're addicted to the anticipation of what may be, and at times, we even perpetuate a strong disdain for proven commodities." |
entering the commercial market. When I learned this, I mentioned a successful, middle-aged sire at the farm who would stand the following season for less than a third of what the new, unproven colt would stand for. His response has stuck with me ever since: "Well, yeah, but what fun is it to breed to a proven sire?" In one brief sentence, he summed up the psychological foundations of our industry: We're addicted to the anticipation of what may be, and at times, we even perpetuate a strong disdain for proven commodities. The possibility of getting in on a sire who will later become the next Danzig, regardless of the odds, is an integral part of the mind set that drives our business. And as crucial as this psychology is to fiscal windfalls of some members of our industry, it is equally destructive to efforts aimed at recruiting new owners. Nowhere is this phenomenon more apparent than at the yearling sales. Sires with the most important credential, proven progeny, are usually pushed to the middle and lower levels of the market in order to make room for the capital that will be spent to medicate this excitement we've developed for first year sires. Agents and advisors will make a substantial portion of their income by... (click here for the full article)
The Myth of the Female Family
The late Joe Estes argued incessantly through out his writing career that a mare’s race record was the single most important predictor of future success as a broodmare. In the 1999 compilation of his writings and speeches “The Estes Formula for Breeding Stakes Winners”, Estes writes “…regarding pedigree selection… it should usually be a minor accessory to individual selection, being permitted to sway the balance in makingdecisions which are fairly close on individual merit.” Estes was a staunch believer in acquiring successful racemares, with female families and pedigree being minor considerations.
On the other side of the debate, current icons in the industry like Seth Hancock argue for strong female families, more so than racing class. In Edward L. Bowen’s book “Matriarchs: Great Mares of the 20th Century”, Hancock in scripts in the forward: “Generally, I believe... (click here for the full article)
The Six Generation Stallion:
The Fallacy of the Pedigree Pundits
In looking over the year-end general sires list, do you ever wonder what happened to the sixth-generation sire? You know, the stallion who possesses all those mythical qualities in his six-generation pedigree that pedigree pundits are always talking about.
If patterns of linebreeding, inbreeding, nicking, and female families are in fact precursors to a magical genetic virility, we would have seen the six-generation stallion success story by now.
But it never happens that way. Sure, there are plenty of anecdotes in favor of the six generation stallion, but in each case... (click here for the full article)
Stamina and the Maternal Influence:
Is Stamina Crucial to Future Success?
As long as there is horse racing, the debate will go on: What traits are most important in successful broodmares? There are those who are adamant about a mare’s female family, refusing to consider those without significant black-type on their catalog pages. Others rely on the mare’s race record, and some argue that confirmation is most important.
But what about the running style of prospective broodmares? Is there a difference between mares with early turn of foot and mares that require longer distances? Much of the current literature seems to focus on the importance of the dam’s ability to pass along stamina, theorizing that mares are more adept at passing along the genetic material required for stamina. Based on our study... (click here for the full article)
Stallions
Entering Stud Between 1994 and 1997: Where Are They Now?
Intuitively,
most breeders know that the odds are stacked against a stallion
ever becoming a long term success. If asked, most of
us can rattle of a long list of failures that were quickly
exported from central Kentucky, usually landing in regional
markets or foreign countries.
The
irony then occurs when we look at the enormous support first
year stallions receive both in the breeding shed and the sales
ring. Each year, the list of most heavily bred stallions
is littered with first and second year horses despite the knowledge
that most of these horses will fail. Case in point, during
the 2004 breeding season, no horse bred more mares than... (click here for the full article)
|
