Buyers Take a Chance With Yearlings From First-Crop Sires

Agents, owners, and trainers are purchasing yearlings by first-crop sires at the Keeneland September yearling sale because there is more upside than downside. With no horses to race, each sire still has unlimited potential.

It does not take Bloodstock agent Buzz Chace long to explain why he likes buying yearlings from a stallion’s first crop.

“Unbridled’s Song, Artax, Nothing But Fun…” he begins, rattling off names of top racehorses he has purchased or selected on behalf of clients from their respective sires’ first crops offered at public auctions. “That’s only the beginning. It’s a long list.”

Upon Chace’s advice, Paraneck Stable bought Unbridled’s Song, from the first crop of Kentucky Derby (gr. I) winner Unbridled, for $200,000 at the 1994 Fasig-Tipton New York August yearling sale. The colt went on to win the Florida Derby (gr. I) and Breeders’ Cup Juvenile (gr. I) while earning more than $1.3 million. He is now among the leading sires.

Purchased out of the 1995 Fasig-Tipton November mixed sale by Trifen Inc. for $82,000, Artax was from the first crop of Marquetry. He went on to win nine of 32 starts and earn $2.8 million. Nothing But Fun, from the first crop sired by Dixie Union, was bought by Chace for $150,000 from the Lane’s End consignment to the 2003 Keeneland September yearling sale. The filly has won five of 13 starts, including the grade II Cotillion Handicap, while earning $455,500.

Chace and other agents, owners, and trainers take a shot with first-crop sires at auction because there is more upside than downside. Afterall, with no horses yet to race, each still has unlimited potential. “It’s easy (to justify buying offspring of first-crop sires) because you can’t knock them,” Chace said.

The hope is that if the stallion hits, the offspring bought from the first crop would have been purchased at prices well below what the stallion will command later.

“American buyers have a fascination with first-crop sires,” said Geoffrey Russell, director of sales at Keeneland. “There has never been a bad one.”

While first-crop sires have been cataloged throughout marathon Keeneland September yearling sale, an inordinate number are offered during the second week of the sale. Sunday’s session was topped by a Lion Heart colt who was sold for $440,000 and a Speightstown  filly, who brought $360,000.

Through Tuesday's eighth session, the sale’s leading first-crop sire by average, with three or more sold, was Derby winner Smarty Jones . With 29 sold out of the 51 offered, Smarty Jones yearlings averaged $197,241, nearly twice his 2005 stud fee of $100,000. He was followed by champion sprinter Speightstown, with 37 sold for an average of $184,595 from 56 offered. His 2005 fee was $40,000.  Third amongst first-crop sires was Medaglia d'Oro, with 37 sold out of 58 offered for an average of $151,216.  His 2005 Stud Fee was $35,000.  Rounding out the top 5 first-crop sires by average, with three or more sold, were Strong Hope  and Candy Ride (ARG).  Strong Hope, whose 2005 stud fee was $30,000, recorded an average of $143,346 for 26 sold out of 39 offered. Five out of the six yearlings by Candy Ride (ARG) sold, for an average of $143,000.  Candy Ride (ARG) stood for a fee of $10,000 in 2005.

Lion Heart, whose first crop of 187 reported foals was the highest all among North American stallions, was well-represented at Keeneland, with 45 yearlings (from 57 offered) averaging $109,956 through Tuesday. His 2005 fee was $30,000.

Despite the popularity of yearlings from first-drop sires, many consignors’ clients do not part with them willingly. Of the 410 freshman sire yearlings offered through Tuesday, 28.4% had been bought back.

Maybe their owners want to take the same risks taken by buyers like Chace.