Glory Ann Kurtz
Executive Editor, Quarter Horse News

When they go to a sale, horse buyers love yearlings! They’re fit and gorgeous, but best of all, they’re untried. It’s the gamble that seems to turn them on.

But buying young prospects is probably the biggest gamble in the horse business. However, a lot of buyers think they can beat the system. Especially those with a pocket full of money that are savvy about performance horse pedigrees. They are just positive that a High Brow Cat colt out of a Smart Little Lena mare is going to be a winner and will more than likely pad their bank account and put them in the headlines in years to come. That cross is probably the hottest commodity going.

Glory Ann Kurtz

Glory Ann Kurtz is the Executive Editor of Quarter Horse News and the author of Barrel Racing, Training the Wright Way, a coffee-table book with top barrel horse trainers Ed and Martha Wright. She is a contributor to the Western Horseman "Legends" book and is the editor of the annual Performance Horse Sale Guide , an informative guide on all horses that go through the major cutting, reining and reined cow horse sales. She and her husband, Bob, compete in local cutting competitions and run a performance horse breeding operation in Boyd, Texas.

But when you’re the hottest commodity going, there will undoubtedly be a lot of other buyers with deep pockets and a head full of pedigree knowledge, that have the same idea. It only takes two buyers that want the same horse, to run his price up. When there’s a room full, prices soon get ridiculous.

Buyers with the ability to pay big bucks for a top prospect sometimes let their desire to own the horse that everyone else seems to want, overcome their business sense – and they soon own a very expensive horse. In the excitement of the moment, they have forgotten how much it is going to cost to get that yearling trained so he can even get shown in the cutting arena. Then there’s entry fees and hauling costs to aged events before that horse can even start paying the buyer back for his investment.

In the Thoroughbred business, there is a lucrative business in pin-hooking. Pin-hooking is when a buyer purchases horses as yearlings and resells them as 2-year-olds … for a tidy profit.

But in the cutting, reining and reined cow horse industry, pin-hooking isn’t exactly what I would call “lucrative,” even though a few people made some money.

During 2002, which would have been the year that the yearlings showing in 2004 and 2005 would have sold, 1,100 yearlings in all three disciplines averaged $10,102 for a $5,500 median. (Median is halfway between the highest- and lowest-selling horse. This is used in the Thoroughbred business more than the average because it is more accurate, knocking out the extremely high-selling and low-selling horses). That same year, 480 2-year-olds averaged $11,956 for a $6,000 median.

Pin-hookers would have only netted $1,854 per horse in the average or $500 in the median, which is hardly enough to get the colt fed for a year, broke and started on cattle.

Therefore, it’s highly unlikely that horse buyers purchased yearlings with thoughts of selling them in the 2-year-old sales the following year. As 2-year-olds they are broke and are now a “known quantity.”Their chase is the lucrative upcoming aged events for 3-year-olds and over. Now they’ve got to wait another year … or two … or three … and pay additional training, vet expenses, hauling and practice fees.

Performance Horse Sale Guide
As executive editor of Quarter Horse News, I have a deep interest in the sale industry. That’s the ultimate goal of those in the industry — to sell horses and make money.

I keep a computer database of all the horses that sell in the major cutting, reining and reined cow horse public auction sales throughout the year. At the beginning of the following year, we publish a Performance Horse Sale Guide, dissecting the entire performance horse public auction sale industry from the previous year.

Listed are all the horses that passed through the sale ring. For all the horses that are announced as “sold” by the sale companies, we order a printout from the breed association approximately four months after the sale, making sure that the horse transferred ownership.

If the horse has not transferred ownership within that four month period of time, he is marked a “no sale” in our sale guide. Some of those horses may have actually sold — I have been told by the sale companies that some high-dollar horses are sold on time and haven’t transferred because they haven’t been paid off yet. My take on that is that if a horse is sold on time, the deal is made prior to the sale, and that is not a “sale at auction.” That is a private sale.

All the horses that passed through the sale ring are listed in alphabetical order in the back of the book, along with their age and sex, pedigree, if they are bred or have foals at their side, seller, buyer, sale they were consigned to, if they changed hands or “passed out,” and the final bid amount.

The horses that were actual sales are massaged throughout the sale guide, with chapters on leading sales or horses of a certain age, leading sires by discipline, leading sires of yearlings by discipline, 2-year-olds and older horses. There’s a section for broodmares sold by discipline, leading grandsires and maternal grandsires, sellers and buyers.

In the center of the book is a unique section called “the magic cross,” which lists the leading stallions and how the mares were bred that they crossed best with for those high-selling offspring. It’s a valuable tool for breeders, as well as sellers and buyers.

Needless to say, I spend a lot of hours trying to figure out the financial aspects of the sale horse business.

Article published in May 2004
On May 1, 2004, I wrote an article in Quarter Horse News called “What happened to all those high-dollar horses,” which was a 10-year overview of the industry’s highest-selling horses. The results of my research for that article were both surprising to me and the readers.

It was discovered that 67 percent, or 546 of the 822 horses selling for $25,000 and above, had earned money; however, the surprising fact was that only 13 percent of the horses selling for $25,000 or more earned more money than they cost. Of the 21 horses that earned over $100,000, over half of them were purchased for less than $50,000. Only two sold for more than $100,000. The average price of those 21 head was just over $62,450.

Les Burwash called me after he read that article and asked that I do a talk at this conference about my findings. It was impossible for me to accept his invitation last year, however, I took a rain check — and here I am.

Research on yearlings sold in 2001; earned money as 3- and 4-year-olds
I used my sale records to determine the high-selling cutting, reining and reined cow horse yearlings. Then I ordered reports from Equi-Stat, the statistical division of Quarter Horse News, that records all earnings horses showing during the years have earned.

For years, Quarter Horse News has done statistical reviews on money earned by cutting horses, reining horses and reined cow horses, and published those results in a number of their issues. We are the first, and only, publication that keeps track of earnings of these horses and publishes statistical issues, naming the leading money-earning horses for the year (or lifetime), as well as shows, sires, breeders, riders, owners, grandsires and maternal grandsires. What originally started as a data base for the editorial department to be able to track the history of a horse’s earnings, has become an important part of this industry for owners and breeders, and is especially helpful for newcomers in the industry.

The results of the match of sale figures with earnings figures from these yearlings was rather astounding.

Cutting Horses
In 2002 sales, 711 yearlings sold for $8,571,500, averaging $12,056 for a $6,250 median. Thirty-five of those 711 yearlings sold for $40,000 or more.

After two years of showing (2004 as 3 year olds and 2005 as 4 year olds), 40 percent (14 horses) had earned money. Most of the money was won in cutting competition, however, some was earned in reined cow horse competition. However, NONE had earned as much or more money than they cost. Most weren’t even close. Sale prices ranged from $380,000 down to $40,000. Earnings ranged from $260,000 down to $429.

The year 2002 was the year that Jeff Matthews of North Carolina, an heir to a turkey and chicken fortune, spent a lot of money. Although he wasn’t the highest buyer for the year, he did purchase eight head for $645,500. His sister, Carol Baggett, also purchased another four head for $267,000, for a grand total of $912,500 for 12 head, an average of $76,042 per horse. Between the two of them, they were the high buyers — with $912,500 spent on cutting horses.

The highest-selling horse, One Time Pepto, a stallion sired by Peptoboonsmal out of One Time Soon by Smart Little Lena. Consigned by Dave and Clare Capps to the Western Bloodstock Preferred Yearling Sale held during the NCHA Futurity, he was the highest-selling yearling and second highest-selling horse of 2002, bringing $380,000 from Jeffrey Matthews.

The beautiful roan stallion has since earned over $260,500 in lifetime earnings with Matt Gaines in the saddle, which is still $120,000 short of his purchase price. His biggest win was the Championship of the 2004 NCHA Open Super Stakes, where he won $118,044 plus $55,000 in Incentive Stallion money. He won $55,000 for being the highest money-earning horse in the NCHA Futurity, selling in the previous year’s NCHA Futurity sales.

Matthews recently told me that they will continue to show the stallion during his 5- and 6-year-old year, with the possibility of winning even more aged-event money. The 5- and 6-year-old events don’t pay as well as the 3- and 4-year-old events, however, with the number of events available and the lucrative Western Horseman Cup finals at the end of the year during the Augusta Futurity, earnings can be substantial.

However, in his case, he is a popular stallion, which will be standing his first year at stud this year, sporting a $5,000 stud fee. His semen has not yet been tested, however, should it have lots of life, Matthews should be able to recoup on his investment. However, it will take a lot of years before it’s known whether or not he will be a successful sire. His first colts won’t hit the ground until 2006 and won’t be able to prove themselves in the cutting arena until 2009. If they are successful in the cutting arena, that $5,000 will go up; however, that’s seven years from Matthew’s initial investment.

Vaca Rey, a stallion by Smart Little Lena out of Autumn Boon by Dual Pep, Javolight, a Grays Starlight daughter out of Javolena by Doc O’Lena, and A Special Boonsmal, a stallion by Peptoboonsmal out of Berry Special Peppy by Peppy San Badger, sold for $235,000, $130,000 and $110,000. They have not earned any money to date.

Little Bag of Rubies, a daughter of Smart Little Lena out of Ruby Bagonia by Peppy San Badger, consigned by Rafter M and sold to Arcese Enterprises, sold for $130,000 in the Western Bloodstock Preferred Yearling Sale. She’s earned $429 by finishing third in a small aged event held at Silverado Arena in Weatherford, Texas, ridden by Phil Rapp.

Kats Dainty Gal, a daughter of High Brow Cat out of Dainty Playgirl by Freckles Playboy, sold to Carol Baggett for $98,000. She also bought Play Miss Lena, a Smart Little Lena daughter out of Starlight Playgirl by Grays Starlight for $90,000. Cats N Dox, a daughter of High Brow Cat out of Dox Lena Gina by Doc O’Lena, consigned by Rancho Petersen, brought a $75,000 final bid from Debbie and T.J. Day. None of these mares has earned a dime.

Matthews also bought Perry Shorts, a daughter of Shorty Lena out of Perry Poo by Perry San, for $78,000, who has since shown her to $15,763 in Non-Pro aged-event earnings.

Jae Bars Fancy Cat is close to breaking even. The yearling daughter of High Brow Cat out of World Champion Jae Bar Maisie by Doc’s Jack Sprat, sold for $75,000 in the Breeders Coop Yearling Sale held during the NCHA Futurity. Consigned by Ron Knutson, she sold to Eddie Longley of Weatherford, Texas, and has since earned over $70,000 in lifetime earnings.

Lena Red Pep, a well-bred daughter of Peptoboonsmal out of Lenas Sissy Moon by Doc O’Lena, sold for $75,000, but to date has only earned $3,515 in aged-event earnings, ridden by Gary Gonsalves.

Starlights Whitney, a daughter of Grays Starlight out of Peppy Hickory San by Doc’s Hickory, purchased by Lonnie and Barbara Allsup at the Polo Ranch Sale for $71,000 and Dainty Playmate, a daughter of Freckles Playboy out of Dainty Lena by Smart Little Lena, purchased by Carroll Baggett for $69,000 never earned any money.

Spooks Starman, a stallion sired by Grays Starlight out of Lynx Star Lady by Doc’s Lynx, sold at the Polo Ranch Sale for $64,000. The stallion later finished seventh in the finals of the National Reined Cow Horse Association Snaffle Bit Futurity with Ron Ralls in the saddle and the following year won the NRCHA Derby, for a total of $30,975.

Peptos Royal 001, a daughter of Peptoboonsmal out of Clarks Royal by Clark’s Doc Bar, sold for $63,000 in the Western Bloodstock Preferred Yearling Sale to the Brinkmann Ranch, and later was sold to Frank and Bonnie Martin of Las Vegas. She was ridden by Russ Miller in the Open and Frank, in non-pro aged-event competition, to $15,100 in earnings.

Little Mister Light, a Grays Starlight stallion out of Little Mist Smart by Smart Little Lena, sold for $63,000; Fancy Rey Freckles, a daughter of Dual Rey out of Lashawns Freckles by Colonel Freckles, brought $60,000 and Little Peppys Date, a daughter of Smart Little Lena out of Peppys Date by Peppy San Badger, sold for $55,000. All impeccably bred, none earned a dime.

Spook Lil Cat, a daughter of High Brow Cat out of Spooks Doc by Grays Starlight, sold for $60,000 at the Polo Ranch Sale to the Oxbow Ranch. Later sold to William and Michelle Cowan, she was ridden by Lindy Burch and Michelle Cowan to $8,156 in earnings at the 2005 NCHA Super Stakes.

Starlights Rhonda, another daughter of Grays Starlight out of Smokin Hickory Lena by Smart Little Lena, also brought $60,000 at the Polo Ranch Sale, by the San Juan Ranch. Still owned by them, she was shown in reined cow horse competition in 2004 by Ted Robinson, earning $23,009.

Peptos Boon Shadow, a stallion by Peptoboonsmal out of Dry Shadow by Dry Doc, brought $52,000 by Randy and Joan Martin and then shown in reined cow horse competition by Robbie Boyce, winning $1,508.

Cats Curly Kitty, a daughter of High Brow Cat out of Curly Rode Her Ma by Colonel Freckles and Lenas Broadway Star, a daughter of Grays Starlight out of Lenas War Doc by Doc O’Lena, both sold for $50,000, with no money earned to date. Little Lenas Montana, a Smart Little Lena daughter out of NCHA Futurity Champion Millie Montana by Montana Doc, brought $46,500; Tenlight, a stallion by Grays Starlight out of Docs Poco Ten by Doc O’Lena; brought $45,000; DL Cat, a daughter of High Brow Cat out of Dainty Lena, brought $43,000 and Jalapeppys Little Lena, a stallion by Smart Little Lena out of Little Jalapeppy by Peppy San Badger, brought $40,000. None have earned a dime.

Iam Little Foxy, a daughter of Smart Little Lena out of Foxy Freckles by Jay Freckles, sold for $43,500 to Wes Adams’ Western States Ranch. Owned by Jerry Yelverton and ridden by Craig Thompson, the mare earned $5,000 for being a semifinalist in the 2005 NCHA Open Super Stakes.

DH Freckles, a daughter of Doc’s Hickory out of Freckled Lena, brought $42,000 by Lonnie and Barbara Allsup and shown by Jaime C Beamer to the Ltd. Open Finals of the 2004 NCHA Futurity, earning $2,307.

Cats Mirage SR, a stallion by High Brow Cat out of Haidas Royal Mirage, brought $40,000 from LKC Ranch, the leading buyers for the year, and earned $850 for being in the finals of the Ltd. Non-Pro Division of the 2005 NCHA Super Stakes, ridden by his owner Lloyd Claycomb.

Catty Starlight, a stallion by Grays Starlight out of Cats Bobby Sox by High Brow Cat, sold for $40,000 to Thomas Mason and was shown by Tim Katona to $4,659 in cutting competition.

Other horses bringing $40,000 in the cutting sale arena, and since then haven’t earned a dime, include Cats Cattalya, a High Brow Cat daughter out of Staraleno by Grays Starlight; Zacks Nu Star, a daughter of Zack T Wood out of Baby Nu Bar by Nu Bar; Little Ms Peptoality, a daughter of Peptoboonsmal out of Smart Disco Day by Smart Little Lena and Smart Little Cassie, a daughter of Smart Little Lena out of Freckles Cassie by Colonel Freckles.

Reining Horses
The highest-selling yearling sold in a 2002 reining sale during 2002 was Smart Great Dude, a stallion sired by Smart Starbuck out of Miss Great Dude by Great Pine, selling in the Legacy Reining Breeders Sale by Tom and Mandy McCutcheon to TLC Farms Ltd., for $78,000.

The stallion was shown in 2004 by Tom to the finals of the National Reining Horse Association Futurity and the Tulsa Reining Classic. His wife, Mandy McQuay McCutcheon showed him in 2005 to the Reserve Non-Pro title at the NRHA Breeders Classic and won the Non-Pro Division of the NRHA Derby, for total earnings of $21,488, less than 28 percent of his purchase price.

Pepto San Man, a stallion by Peptoboonsmal out of Cee Miss San Man by Freckles San Man, brought $32,500 and Baldy Starlight, a stallion by Grays Starlight out of Twistin Lena by Doc O’Lena, brought $31,500. Both sold in the NRHA Breeders Showcase Sale and neither has won any money to date.

KR Mocha Tee, a daughter of Tejons Peppy Doc out of Brennas Lena by Brennas Kid, was sold by Pete and Tamra Kyle for $30,000 in the Legacy Reining Breeders Sale, to Helen Bearden. Still owned by Bearden, the mare earned $89 ridden by Laurie DeLeu in a 2005 weekend reining show.

Smart Ruf Peppy, a stallion by Lil Ruf Peppy out of Smart Alice by Smart Little Lena, selling for $28,500; Lil Benz, a stallion by Smart Starbuck out of High Gloss Hollywood by Hollywood Dunit, selling for $26,500 and KR Irish Tee, a stallion by Tejons Peppy Doc out of Dox Mark by Makinyourmark Her Irish, selling for $25,000 all sold in the Legacy Reining Breeders Sale. None has won any money to date.

Dry Peppy Rose, a stallion by Lil Ruf Peppy out Dry Sugar Rose, the earner of close to $120,000 in reining competition, sold for $25,000 in the Legacy Reining Breeders Sale to Doug Adair. Shown in 2005 by owner Kelli Jean Caves, he earned $30 in Non-Pro Reined Cow Horse competition.

Reined Cow Horse
Col Cinco Freckles, a stallion sired by Smart Little Lena out of Doc A Freckles by Colonel Freckles, was the highest-selling yearling sold in a 2002 Reined Cow Horse Sale, bringing $48,000 from Gordon and Rinda Galameu at the NRCHA Select Yearling & Broodmare Sale.

Neither Col Cinco Freckles or Royale Roo Star, the second high-selling yearling has yet earned a dime. Royale Roo Star is a daughter of Gallo Del Cielo (Rooster) out of Miss Royale Dry by Dry Doc, selling for $35,000 to Newton White. Also, MDP Smart Remedy, a stallion by Mister Dual Pep out of Ima Smart Remedy by Smart Little Lena, which sold for $31,000 to Larry and Sharon Rose, has not won any money to date.

Shiney Dancing Shoes, a daughter of Shining Spark out of Miss War Doc by Doc’s Prescription, which was sold to the Magic Dog Ranch Inc., for $31,500 by Carol Rose in that same yearling sale, earned $13.44 in 2004.

Desire To Shine, another daughter of Shining Spark out of Desire A Lena by Doc O’Lena, sold by Rose to Holly Gregory for $30,000. Owned by Ruby View Q.H., the mare was ridden by Karl Smith to $2,821 in 2004 reined cow horse competition.

And the moral of the story is …
After all this research, what is the moral to all these findings. At first glance, one thinks, “Wow – I better not invest in the performance horse business. It’s a losing proposition.” But I really don’t think that’s the case.

I checked the cutting horses that sold during 2002 from $25,000 through $30,000 and found that seven of the 26 horses had earned money in the cutting arena. In fact one, Tap Dancing Cat earned over $100,000. The a son of High Brow Cat out of Hickorys Golden Flo ($186,179 in lifetime earnings) by Mr Peponita Flo, was consigned by Lynn and Larry Welk and sold to Tom Lyons, Grandview, Texas, for $26,000 in the Western Bloodstock Preferred Yearling Sale. Tom gelded the young stallion and won the PCCHA Gelding Stakes Championship the following year.

Another big winner was Lelani Lena, a daughter of Shorty Lena out of Bring Money by Doc Quixote. Consigned by Mary Jo Reno, the mare was purchased by Julie Wrigley for $26,000 at the Preferred Yearling Sale, who later sold her to Matt Gaines. Matt rode her to earnings of $43,443 and the Reserve Championship of the 2004 PCCHA Futurity.

Also, Rio Smart Lena, a daughter of Smart little Lena out of Money Talks Rio by Doc Quixote, was consigned by Gary and Kathy Benton to the Breeders Coop Yearling Sale. She was purchased by Dan Churchill, Moline, Ill., for $29,000 and went on to win $38,929, making the finals of the NCHA Futurity and the semifinals of the NCHA Derby with David Stewart in the saddle.

Also, Fancy Nancy Dually, a Dual Pep daughter out of a Smart Little Lena mare, sold for $29,500 to non-pro Greg Coalson, and later was ridden by him in non-pro competition to the semis of the NCHA Derby and the Finals of the Super Stakes, for $37,247.

My husband and I have attended a zillion sales over the years and haven’t missed the NCHA Futurity sales in some 27 years. I’ve watched the rich investors come and go. I’ve seen their egos, their trainers and even their advisors, let the sale companies and auctioneers take advantage of them. We’ve also seen the games that the sale companies play and even after 27 years, I can’t figure them all out.

Today, with a single sale company monopolizing all the NCHA aged-event sales held in Fort Worth, (which I feel is the biggest travesty in this industry), you can bet they know who’s got the deep pockets and who doesn’t. They know how far they can push those prices up without losing the buyer.

Those with the deep pockets are the only ones that can reasonably afford to pay $100,000 or more for well-bred prospects. And maybe people will remember when a buyer paid over a quarter of a million dollars for a stallion prospect. Who would breed to a stallion that was purchased for $25,000?

Then there’s always that possibility that they really didn’t pay those large bucks for that yearling. We can only report what the sale company tells us — we’re not allowed to look at their bank deposits and buyers don’t give us their cancelled checks.

In our sale guide we guarantee that we have checked to make sure that the horse transferred, but we can’t guarantee that was really the amount paid. Those big figures make great headlines in the Quarter Horse News, and it’s months later before we realize the horse didn’t really sell. There’s nothing I hate worse than a sale company telling us sale results that don’t shake out to be the truth, and then profit from the story we write about their great sale.

But there’s not much we can do about it if we’re going to give our readers the results of a sale on a timely basis. But that’s why we came up with the idea of publishing a year-end Sale Guide, which gives all the actual sales, after checking with the breed associations to make sure the horses have transferred. They don’t like that sale guide and they go to great lengths to tell everyone it is inaccurate, but I’m proud to say that it’s the closest thing to something real on published sale results that’s out there. Starting this year, that sale guide is included free of charge with every subscription to Quarter Horse News.

But there are plenty of those $25,000 to $35, that earn just as much or more than those $100,000-plus horses.

In November, we attended the PCCHA Futurity in Reno. The winner of the 3-year-old futurity was a colt that a friend of ours bred and we raised with one of our yearlings. He sold him to the trainer, who had a wealthy customer who partnered on the horse. When the partner’s wife wanted out of the deal, the colt, sired by High Brow Cat out of a daughter of Smart Little Lena, sold in the NCHA 2-Year-Old sale that was not the Preferred Session, for $24,500.

It was pretty exciting when he won close to $50,000 as the 3-Year-Old Champion of the PCCHA Futurity. He had also won $24,000 prior to that event, and another $7,500 a week later when he won both go-rounds, the finals and the average at the Utah Cutting Futurity, for a total of over $80,000 — and he didn’t even go to the NCHA Futurity. He is the first aged-event horse owned by Californian Rae Bonsack, his owner, and the rider Tim Castilaw is a relatively new trainer on the win list. He still has two more years to earn aged-event money and then has the personality to be a great Non-Pro horse.

Those are the dream stories. A reasonably priced horse, a new owner in the business, a relatively unknown trainer — and now they’re on the cover of Quarter Horse News.

Those deals are out there. You just have to be discreet; hold on to your excitement and your purse strings when you start bidding on a horse. I would say if you buy an extremely well-bred anywhere from $30,000 to $50,00, it’s a GOOD buy. A GREAT buy is a horse bred that same way selling for $25,000 to $30,000. It’s a definite BARGAIN if you pay under $25,000 for that well-bred prospect.


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