Famous art auctioneer Sotheby's Annual Report 2012 is aptly
covered with "The Scream," the harrowing painting by Edvard
Munch. Why the scream? Sotheby's reported net income of $108.3
million in 2012 reflects a 37% decrease from 2011.
Recently fined around $616 million in the largest-ever SEC
settlement for insider trading allegations, SAC Capital, led by
, also has something to scream about. Last week in the Federal
District Court of Manhattan, Judge Victor Marrero reserved
judgment on approving the settlement, according to Dealbook,
saying, "There is something counterintuitive and incongruous
about settling for $600 million if it (SAC) truly did nothing
A scream theme is not all that ties Sotheby's
and SAC together. The recent Picasso-buying Cohen holds Sotheby's
as a fairly new acquisition of 1,688,821 BID shares, as of
quarter ending Dec. 31, 2012. The current BID share price is
$37.41, with a change from average up 20%. According to GuruFocus
research BID is up 8% year to date.
Incorporated in 1983, Sotheby's is an auctioneer of authenticated
fine art, antiques and decorative art, jewelry and collectibles.
Here's Cohen's BID holding history:
Sotheby's reported 2012 total revenues of $768.5 million, an 8%
decline from the prior year. The company said the decrease was
largely attributable to an 11% drop in auction commission
revenues. Sotheby's also reported a record level of sales from
single owner collections in 2011.
"Consolidated sales in 2012 were a robust $5.4 billion as healthy
bidding continued around the world for great works of art," said
Sotheby's Bill Ruprecht, Chairman, President and Chief Executive.
While best known for the auction side, Sotheby's operations also
include a dealer segment and a finance segment. Sotheby's finance
segment provides collectors and art dealers with financing,
generally secured by works of art that it either has in its
possession or permits borrowers to possess. The finance segment's
loans are predominantly variable interest rate loans.
As a point of interest: In May 2012 Sotheby's sold the Edvard
Munch pastel "The Scream" for a record $120 million.
Munch's mystical description of the inner turmoil that led him to
paint "The Scream" sounds like a high anxiety state, also known
to hedge fund managers and insiders. The artist wrote:
"I was walking along a path with two friends - the sun was
setting - suddenly the sky turned blood red - I paused, feeling
exhausted, and leaned on the fence - there was blood and tongues
of fire above the blue-black fjord and the city.
My friends walked on, and I stood there trembling with
anxiety - and I sensed an infinite scream passing through
As of March 27, 2013, SAC Capital Advisor's portfolio shows 1585
stocks at a total value of $20.3 billion, with a quarter over
quarter turnover of 42%.
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