Sotheby’s (BID), headquartered in New York, is the only publicly-traded auction house in the world. Established in 1744, it deals in auctions and private sales of art, jewelry, wine and collectibles. The company’s performance is strictly cyclical, and its stock has a high beta of 2.8.
Business ModelSotheby’s reports revenues by four different segments, namely: Auction, Dealer, Finance, and License.
The Auction segment contributes most of the company’s revenues, generating them mainly from commissions on auctions and private sales. As an agent, Sotheby’s takes responsibility for facilitating these types of sales by scrutinizing the authenticity and condition of the art property being sold, encouraging buyers’ interest, matching sellers and buyers, and transferring funds and property.
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