Judging by this month’s performance of Skate’s Art Stocks Index (as of Friday, October 16, up 9.6% to 107.4 over September 30), one would hardly guess that the market for fine art still very much favors the buyer at this point – strong performance at recent Hong Kong auctions notwithstanding. In this issue of Skate’s Market Notes, we will focus on three of our art stocks that have performed exceptionally well in October – Sotheby’s, Artprice and Artnet.
Sotheby’s – with a closing price of USD 18.49 on Friday, October 16, Sotheby’s is up just over 7.3% this month and up more than 300% from its 52-week low of USD 6.05 on February 27. Estimates for the major auctions in November and December are still quite a bit lower than they would have been prior to the financial crisis, and there is every reason to believe that buyers will continue to have the upper hand this fall, but strong demand at major Hong Kong auctions earlier this month has certainly buoyed up the stock from the lows of last spring. To put matters in perspective, however, Sotheby’s still needs to more than triple yet again in order to reach its pre-crisis closing high price of USD 57.64, which it achieved just over two years ago on October 10, 2007.
Artprice – closing at EUR 12.06 on Friday, October 16, Artprice has seen a phenomenal increase over its 52-week low of EUR 2.75. This month alone, the stock has seen an amazing increase of just over 82.1% from its September 30 closing price of EUR 6.62, which already represented a 42.8% improvement for the year. Artprice has enjoyed a stellar year thus far and has gone a long way in making up for the heavy damage that was done to its share price in 2007 and especially 2008.
Artnet – closing at EUR 5.88 on Friday, October 16, Artnet is perhaps the biggest surprise given the fact that for much of the year the stock has been on a generally downward trajectory. As of September 30, Artnet’s share price was down 7.5% for the month and 16.9% for the year. And then October came. After closing at EUR 3.99 on September 30 – a price still well above the company’s 52-week low of EUR 3.15 on March 9 – Artnet’s shares have taken off. On Thursday, October 15, Artnet closed at EUR 4.88, marking a 22.3% improvement for the month. The next day, however, the stock closed up yet another euro at EUR 5.88, which brings its cumulative October improvement to 47.4%. Another EUR 0.77 increase and Artnet will reach the 52-week high it achieved on June 10 (EUR 6.65). Despite this month’s newfound excitement, Artnet, like Sotheby’s, has quite a bit of lost territory to cover in order to reach the levels it was trading at in late 2007.
Of these three firms, only Artnet has announced the publication of its Q3 financial statements, which will take place on October 30. This reporting should give us a better indication of whether the recent strong performance is due to solid fundamentals or general excitement in global equity markets. Further updates will follow in upcoming issues of Skate’s Market Notes, as well as in the November edition of Skate’s Art Industry Investment Report.