Valuing Horses

I am sorry, but I am a financial guy so I will keep coming back to this question.

How much should I pay for a horse?

I took a sample of 20 sires and tried to get a balance of expensive and cheap. The sample might be little bit on the high side. That gave me 125 of the 530 or so sold.

From this I found:

1. about 20% have fast works, either 9.4 or 10, or 21.0 or less
2. about 30 have average works of 10.1 or, or 21.1 and 21.2
3. about 50% have slow works either 10.2 and higher, or 21.3 or higher

Then I calculated the price/current stud fee for each. Here is what I found

1. for fast works the median multiple was 6x and the average a little higher
2. for average works the median multiple was 4x, but there many at 2x and 6x
3. for slow works the median was 2x or less, but still 10% were at 4x or more

For each category I dismissed about 10% of the sample as clear “problem” horses. I did not count a horse that worked 9.4 but sold for 1x, or one that worked 21.2 but sold for .3x.

Next I want to see if I can explain the different in price dam’s pedigree or running ability.

These numbers are rough, but they are a starting point for any discussion. The multiples are lower for $50,000 sires and higher for $5,000 sires.