The auction house Sotheby’s is an infamous hyper-cyclical stock, which tends to make extreme peaks right before big downturns, and then collapsing to unbelievable lows during economic troughs.
Well, the stock is off 22% just since its highs in early April, and that’s after bouncing back a couple of bucks in recent days.
The stock made a similar move during the downturn last year, only to rebound mightily, though at current levels the peak nicely aligns with its peaks before big falls.
It’s not hard to understand why the stock moves like it does. There’s no company as exposed to the uber-frivolous end of the luxury market. Nobody ever has to buy a painting, and there’s no natural floor for anything that it sells..