NOTE: Collectable postponed its IPO of the 1916 Babe Ruth card that Wyatt wrote about here. In its place, it will IPO a different Babe Ruth card.
Today we have a deep dive into the 1933 Goudey Babe Ruth #144 SGC 8 that will IPO at Collectable on April 25th, 2021 at 6:30 PM EST.
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What is the 1933 Goudey Babe Ruth #144 SGC 8?
The 1933 Goudey set is an iconic vintage baseball card set, containing a number of the most well-known cards of legendary players of that era. There were four separate Babe Ruth cards in the set (#53, #144, #149 and #181) with the #144 the only one with a full body picture of Ruth. The card was double printed, and as such, there is a pretty large supply still around today, with a surprising number in good condition.
The SGC pop report shows that of the 559 total cards graded, there are 8 SGC 8s and 5 graded higher:
For good measure, there have been 1,143 cards graded at PSA, with 32 graded as PSA 8 and 4 PSA 9s with none higher.
It IPOs on Collectable at 6:33 PM EST (according to the app) on April 25th for $136,000. The consignor is holding $20,000 in retained equity, leaving $116,000 in shares.
Add IPO to calendar
Cultural Relevance
Wyatt covered this in the previous Babe Ruth writeup. Suffice to say, Ruth was one of the greatest baseball players ever and still retains a high level of name recognition today.
Points – 7/10
Inferred Value – $210,000
Just a note that there is a PSA 8 version of this card on Rally Road, and its current market cap is $136,000, though I do believe it to be quite underpriced.
The most recent sale for this specific card I could find was in November, 2013 for $16,730. I couldn’t track down any SGC 8s that have sold in the past year. Most recently, a PSA 8 sold at Heritage on February 27th for $288,000 and at Christie’s in December for $162,500.
The lower graded versions of this card have seemed to avoid the industry-wide dip since February. A PSA 4.5 just sold for $27,100 last week after selling for $21,500 in February – though the more recent sale had a PWCC-A eye appeal rating, so it would be expected to command a 30% premium, which it did. A PSA 4 just sold for $18,730 this week after selling for $19,200 and $16,500 in February. So, I expect that the current value of the PSA 8 to be similar to what it was at the most recent sale in February.
The question, then, is how the SGC 8 value differs from the PSA 8. At the same auction at Heritage in December, a SGC 5.5 went for $19,800 and a PSA 3.5 went for $16,200, indicating a hefty premium for PSA. However, in February a SGC 4 went for more ($24,144) than the PSA 4 ($19,200) at the same auction though the SGC 4 version does look a lot better. Most recently, an SGC 5.5 sold for $35,655 in March (nearly 2x what it went for in December) and a PSA 5.5 just sold last week for $66,000. There’s no hard and fast rule, and the results are sort of all over the place, but PSA does generally hold more weight than SGC. I think it’s fair to discount this card at 25% to the PSA version, though this could very well change in the future as the grading companies battle for market dominance.
That would still value this card at ~$210,000.
Points 9/10
Category Strength
The Sports Cards category had a 60% ROI in Q1 2021.
Points 10/10
Subcategory Strength
The Baseball Cards subcategory had a 40% ROI in Q1 2021.
Points 7/10
Risk Profile
The Baseball Cards subcategory had a 111% standard deviation in Q1 2021. Lower is better.
Points 1/10
Asset Growth TTM
The PSA 8 has seen almost 2x growth and the lower graded versions, both PSA and SGC, have all seen 1.5-3x+ growth in the past year.
Points 10/10
Growth Outlook and Future Catalysts
Ruth’s cards have been appreciating steadily and given his iconic status I’d expect that to continue. The one drawback of this asset is that it’s not as scarce as you would expect for a card from 1933. The Heritage auction of the 1916 Ruth card that Collectable was originally going to IPO is ongoing. The current price (with buyer’s premium) is $2.25 million and with twelve days left is certainly going to go higher. The publicity from a record-breaking sale could lift interest in Ruth’s other cards.
Points 8/10
Asset Liquidity
This will have a roughly 90 day lockup period then will trade daily.
Points 8/10
Platform Risk
Collectable is moderately transparent.
Points 7/10
Intangibles
The retained equity is actually pretty low (14.71%) for the typical Collectable offering. And I’ll bump this up to offset for the relatively low Cultural Relevance score.
Points 9/10
NOTE: I may purchases shares of this IPO.
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