Auction Action by Altan Insights: April 5, 2021
This week on Auction Action, the Altan Insights team virtually visits Heritage Auctions and Leland’s to review a busy weekend of activity.
Heritage held their Comics & Comic Art Signature Auction, which featured over 1,400 lots including comic books and video games - with multiple offerings comparable to assets listed on the alternative marketplaces. Leland’s closed their 2021 Spring Classic Auction, which was highlighted by record-breaking sales and numerous results relevant to alternative investors. Note that all auction prices include 20% buyer’s premium.
The Heritage auction was headlined by a 1985 NES Super Mario Bros (WATA 9.6 A+ Sealed). Through early bidding the game sat at $372,000, before taking off in the extended session where it settled at a new record of $660,000. Rally IPO’d a version of the game with a better grade, WATA 9.8, on August 21, 2020 at a $150,000 market cap. The game has since increased in value to a $216,900 market cap, or $72.50 per share on their secondary market. At its current valuation, the version on Rally sits at a 101.1% discount versus the record-smashing sale at Heritage. The game is scheduled to return to Rally’s secondary market on April 15th. Otis also has a version of the game, with theirs graded WATA 9.4 with a similar A+ seal. Investors on the platform have been actively trading the game, with its market cap already increasing 38.81% from April 1st through April 4th.
Heritage sold a copy of The Legend of Zelda: Ocarina of Time (WATA 9.6 A++ Sealed) for a final hammer price of $31,200. Rally has a version of the game with the same grade but an A+ seal. Currently, the game has a market cap of $23,500 and is expected to trade soon on their secondary market.
Heritage also sold a copy of Zelda: The Adventure of Link (WATA 9.6 A+ Sealed) for a final hammer price of $38,400. Otis has a version of the game with the same WATA 9.6 . Currently the game has a market cap of $34,426, and has increased its valuation by 15.43% over the past week. In total the game is up 16.7% on Otis since its IPO of $29,500 on 1/27/2020.
Investors at both Rally and Otis should be pleased with the results of the Pokémon Blue Version (WATA 9.2, A+ Sealed) sold at Heritage on April 5th, even though it’s not an exact comp. The 1998 Gameboy production featuring Blastoise sold for $10,800, which outpaces a WATA 9.6 version that sold less than a year ago by $2,400. The 9.6 version also had an A++ seal and sold for $8,400 on July 10, 2020. The sale of a lower graded version for a premium signals a positive trajectory for the game overall. Rally IPO’d a WATA 9.4, A++ Sealed example for $24,000, and Otis offered a version with the same WATA grade with an A seal for $10,000. The Otis offering is currently trading on their secondary market and sits at a $13,750 market cap as of April 5th.
Otis is scheduled to IPO Super Mario Land, Yellow Screenshots (WATA 9.4, A+ Sealed) on April 7, 2021, and prospective investors now have an immediate comp to help aid in their investment decision. Heritage sold the game with the same WATA grade and an A+ Seal for $21,600 which is a 38% premium to the $14,700 market cap Otis is expected to IPO their copy at.
Another sale showing a positive trend for investors was the Heritage Pokémon First Edition Gym Heroes Set Sealed Booster Box. The box hit a final price of $16,800, an 86.7% increase since the Gym Heroes box was last sold at the acclaimed auction house. Rally IPO’d a Gym Heroes Booster Box at an $18,000 market cap on March 30th, settling in a similar range to other co-signed sales.
Amazing Fantasy #15 is currently available as an investable asset on both Rally and Mythic. The Rally example earned a CGC 8.0 grade, while the Mythic copy is a CGC 7.0. Sandwiched in the middle is the comic available at Heritage over the weekend, graded CGC 7.5. The Heritage comic landed at a final realized price of $156,000, placing it between the Rally and Mythic versions. The sale is a welcome sign for investors that comic books are returning to levels last seen in 2018, after a short-term retreat in sale prices in 2019. The chart below highlights sales history for 7.0 copies of the comic dating back to 2018, and emulates the recovery this latest sale signals. Even though these sales represent a grade in-between the two assets on the fractional marketplaces, reviewing price trends across a single variable (the same auction house) is a solid method used to establish a range for where an offering graded slightly better or worse should be valued. Formulating valuations based on an arbitrary multiple is highly speculative, and investors should seek to understand the general trend of an asset across its entire spectrum of grades.
Rally IPO’d one of the 18 copies of Stan Lee’s 1961 Marvel Fantastic Four #1 in August 2020 at a $105,000 market cap. Through initial trading sessions, the game has dropped 23.4% in valuation and currently holds a $90,000 price. Heritage sold a copy with the same CGC grade for $132,000, which is a 37.8% premium to the Rally comic at its current market cap, and a 22.8% premium to the offering price of the Rally version.
Investors on Rally have managed to accurately price the 1963 Marvel Tales of Suspense (CGC 9.4), at least according to the results from the Heritage sale. Heritage sold a copy of the comic (CBCS 9.4), which sits in the top 1.5% of all graded examples, for $132,000 - the current market cap of the Rally version. The comic IPO’d on Rally at a $159,000 market cap in August 2020, but has since traded down 18.56% to reach its current valuation. The chart below indicates the Heritage sale signifies a breakout from previous prices after the comic book was range-bound from 2013 to 2020. Note: CBCS is a grading agency with comparable results and sales to CGC. CBCS was founded in 2015 by the original primary grader of CGC, Steve Borock, then was bought out by Beckett Media in 2018 (Source: qualitycomix.com).
Otis currently has a version of the Fantastic Four #52 (CGC 9.6) with off-white to white pages trading at a $24,950 market cap, after an initial offering at $24,000 on July 7, 2020. Heritage sold an example of a comic featuring the same grade with white pages for $50,400 on April 1st. This sale is double the price of any CGC 9.6 copy ever sold on Heritage, with the highest previous sale striking a final price of $23,900 in 2015.
Similar to the Fantastic Four offering, Otis also has a copy of Daredevil #1 which they IPO'd for $51,000 on 1/25/21. The asset has traded up to a valuation of $81,760 for a 60% gain since IPO. Heritage sold a copy of the comic with the same grade for $150,000 which represents a 58.9% premium compared to the Otis edition.
Not to be outdone during a lively auction weekend, Leland’s set a new record for any 1979 O-Pee-Chee #18 Wayne Gretzky Rookie Card (PSA 9) with a sale price of $259,501. Collectable currently has a PSA 9 of the same card trading on their secondary market with a market cap of $167,500. The asset has gained 150% since its IPO on the platform, when it opened publicly at a $67,000 market cap - though the current valuation still sits at a 42.9% discount to the Leland sale.
The mania surrounding the 1986 Michael Jordan Fleer Rookie Card has continued to subside with Leland’s PSA 10 selling for $426,678. The sale marks the lowest realized price of 2021 and the card has seemingly found a new support level in the $400K-500K range. The Collectable card currently has a market cap of $422,500 and has gained 322.5% since its IPO of $100,000 on October 1, 2020. After reaching a high of $600,000 on the platform, the card has since experienced a pullback, dropping 28.4% over the past 30 days.
Another card that experienced a drop in value at Leland’s auction was the 1981 Topps Magic Johnson (PSA 10). After the card reached a new high of $59,000 at the March Monthly Card Auction hosted by Goldin Auctions on March 20th, Leland’s version sold for $25,833. Investors should be hesitant to put too much stock into one outlier sale, as prior to this price the card had sold four other times in 2021 with all sales hitting prices above $39,000. Otis offered a Magic Johnson card from the same set with the same grade for $47,400 on March 26th.