Why would D Hall be a big seller of PCGS stock?
NGC grades over 2 million coins a year. Could the bulk of rare world coins be graded?
Lots of new grading companies in China. Could technology be taking over human inspection of coins?
Just my guesstimate.....
Peter thinks personal reasons. I believe that when you sell 1/3 of your holdings (600K shares at start of year to 400K now) over a course of a year in a company you have been part of for 30 years it is a strategic decision.
He has every right to sell and if I were him I would sold 100% of my shares once they broke low 20s. What is interesting is the flawless timing of it, just as many of us dealers were turning against bullion type coins the sale transactions started occurring. One advantage of being a dealer vs collector or investor is as a dealer we saw all this IRA bullion and collector/investor start to come to market in a big way as Trump pro business agenda was unfolding and stock market continued to climb with little volatility and crytos caught the attention of many. This was a clear message that bullion will be in trouble later in the year, which means grading companies would struggle as their primary revenue is grading new bullion issues. The worst part was you couldn't short CLCT, because it had high dividend and that carrying cost made the short very expense to hold.
PCGS dominance is in vintage coins, there are very few of these floating around that need certification, their big push has already happened and from a grading perspective this will be a declining revenue forever. China grading companies I don't know if that matters, but what does matter is mint and/or dealers prefer to sell in fancy boxes rather than slabs all the newer issues. There are dealers that are looking into computer graded coins, I don't know how close we are to a true AI algo to do this, but it would certainly be a good investment to make.
