Since low cost of capital and asset price inflation, particularly the crypto boom, have bloated global wealth and crowned a rising generation of millionaires, demand for Ferrari automobiles has increased dramatically. The need for self-promotion on social media has undoubtedly fueled the market for expensive cars. Despite this, Ferrari had a record-breaking year in 2021, posting $5.1 billion in revenues, a 23.4% increase over the previous year, and $1.8 billion in EBITDA, a 35.7% increase. Ferrari generated $1.33 billion in revenue and $471 million in EBITDA in the first quarter of 2022, showing no signs of a downturn. Moreover, Ferrari stated that the order backlog will continue to underpin demand well into 2023, therefore guidance remained highly bullish.
Although the fundamentals are strong, Ferrari stock is now trading at a premium. The market is undoubtedly pricing in an acceleration of Ferrari’s business expansion at > x30 P/E. However, I think that this is improbable. Asset price deflation, rising capital expenses, and a slowing crypto economy are the main factors that have been driving Ferrari’s positive upsurge. In addition, the market thinks Ferrari’s business will survive a recession well. However, there are solid arguments against it. Most significantly, sales of premium vehicles decreased by around 35% during the financial crisis.
However, regardless of whether you define the benchmark as the automotive industry or the luxury category, Ferrari is trading at a large premium to peers. For comparison, Ferrari’s P/E is > 500% more expensive than Mercedes Benz and around 50% more expensive than LVMH. Therefore, I consider RACE stock to be extremely susceptible to a multiple contraction. This can occur in addition to the decline in EPS.
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Other Dangers
This year, Ferrari will spend EUR 800 million on capital projects. The company will also pay higher tax rates as a result of the promising 2021 outcomes.
Last year, the business increased prices mostly as a result of inflation. The price of aluminum will increase again this year. Fortunately, Ferrari’s clientele is not price-sensitive. In addition, the introduction of new models supports the price increase. Customers can also personalize the model they choose.
What does Ferrari’s foreseeable future look like?
Before purchasing a company’s shares, investors intending to build their portfolio might wish to think about the company’s prospects. A more compelling investment thesis would be significant growth potential at a low price, despite value investors’ contention that intrinsic value in relation to price is what matters most. Future prospects for Ferrari appear promising with profit predicted to increase by 44% over the following couple of years. It appears that the stock will have stronger cash flow, which should result in a better share valuation.
Why Ferrari Stock Is a Favorite for EVs at Morgan Stanley
Morgan Stanley has identified Ferrari (RACE) stock as its favorite and one that investors should pay special attention to as demand for electric vehicles continues to surge.
Morgan Stanley predicts that the Maranello, Italy-based business will emerge as one of the main competitors in the electric car market by 2040, in large part because to its vehicles’ outstanding technical capabilities, prestige, and highly wanted design (purchasing one requires a two-year waiting).
Ferrari’s price objective was set at $265 by Morgan Stanley, and the firm is expected to spend $13 billion on capital expenditures between 2022 and 2030. A significant commitment that it says is currently not reflected in its current price is that more than half of that is anticipated to go toward enhancing its battery electric vehicles.
According to Morgan Stanley, the price of the current Ferrari BEV will increase from its current $330,000 per unit to $500,000 by 2032 and just under $1 million by 2040. The analysts believe they can justify nearly 98% of the company’s enterprise value by assuming 24 times Ebitda on its fiscal year 2030 earnings, generated by impact, confidence, and ease, and discounted back to the present at an 8% weight average cost of capital.
NV Stock Forecast for Ferrari
- Based on the stock performance over the last five years, Ferrari NV has traditionally increased by an average of 40.6% over the following 52 weeks.
- Ferrari NV has increased more over the succeeding 52-week period in 5 of those 5 years, giving it 100% historical accuracy.
- Is the stock of Ferrari NV undervalued?
The RACE score is 48, which indicates higher risk than usual and is 4% below its historical median score of 50.
- RACE’s current price is between the 40th and 50th percentiles of its historical Stock Score range.
Will the price of Ferrari rise?
Stock Price Prediction The median price target among the 18 analysts who are providing 12-month price projections for Ferrari NV is 243.50, with a high estimate of 300.00 and a low estimate of 173.39. From the most recent price of 199.38, the median projection reflects a rise of +22.13%.
Are Ferrari shares worth purchasing?
The general consensus is to buy Ferrari. Based on 8 buy ratings, 6 hold ratings, and no sell ratings, the firm has an average rating score of 2.57.
Who creates Ferrari?
Who currently owns Ferrari? FIAT Chrysler Automobiles (FCA) reorganized to create Ferrari N.V. as the holding company of the Ferrari Group, and then sold 10% of its shares and allocated the remaining 80% to FCA stockholders. Piero Ferrari held 10% of Ferrari and still does (son of Enzo)
Is Ferrari a profitable business?
Numerous financial metrics and important ratios also demonstrate Ferrari’s success. The Italian automaker, which is the most lucrative in the automotive sector, has successfully increased not only its sales and turnover but also its stock market worth.
How much is a Ferrari?
An interactive graph shows Ferrari’s (RACE) historical market capitalization (net worth) over the previous ten years. A company’s market capitalization, or the current stock price multiplied by the number of outstanding shares, often represents how much it is worth. Ferrari has a $36.33B market value as of September 16, 2022.
Ferrari N.V. is a company that creates, produces, and sells sports automobiles. Its offerings include two grand tourer (GT) vehicles, the California T and FF, as well as sports car types including the 458 Italia, 488 GTB, 458 Spider, 488 Spider, F12 Berlinetta, and 458 Speciale. The company also creates one-off, limited-edition, and supercars like the LaFerrari. Its primary operating regions include Greater China, Europe, the Middle East, India, Africa, the Americas, and the rest of Asia-Pacific. The headquarters of Ferrari N.V. are in Maranello, Italy.
Fiat still owns Ferrari, right?
No, but Ferrari once held a significant share in Fiat. In 1969, Fiat S.p.A., also known as the Italian Automobile Factory of Turin, acquired a 50% stake in Ferrari.
Who is the original Ferrari owner?
- Indian investors should take a conservative stance, according to Gautam Chhaochharia, ED & Head-India Mid Cap Research at UBS Securities. He has a weak position in the financial industry. At the moment, he prefers Federal Bank and ICICI Bank but dislikes SBI. “4700-4800 is a great support level.”
Singapore:
The 1947 Turin Grand Prix winner, the world’s oldest Ferrari, has been revealed for the first time following restoration and is now estimated to be worth an astounding $8 million.
The 166 Spyder Corsa, which was created by designer Enzo Ferrari just after World War II, is thought to be the oldest Ferrari in existence and was repaired for $500,000 by its owner Jim Glickenhaus of California, according to the Daily Mail.
This 12-cylinder vintage automobile is a one-of-a-kind, capable of speeds of up to 160 kmph, which were sufficient to win the vehicle the 1947 Turin Grand Prix.
Glickenhaus, 62, said that he paid roughly $770,000 for the vehicle in an auction in 2004.
After his first build crashed, Enzo Ferrari sold the vehicle, which had the serial number 002, for the first time in December 1947.
A Ferrari with the registration number 001C was claimed to be the oldest in the world by its owner in 2006.
This was actually a No. 2 vehicle produced prior to Mr. Glickenhaus’ 1947 model and might include some components from the first 01C Ferrari that crashed. However, this car uses Ford motor components in place of the original engine.
According to Glickenhaus, “My Ferrari still has the original chassis, engine, gearbox, and most of the mechanical elements.”
“I drove it to Marenello, the birthplace of Ferrari, in northern Italy. You can locate the mechanics who have kept this machine’s history alive there. They have all the necessary photos, components, and information to conduct an accurate restoration “said Glickenhaus.
Who is the Ferrari family?
The Agnelli family, proprietors of the iconic Italian sports cars Ferrari and Juventus, have acquired a 24 percent share in the French high-fashion company Christian Louboutin, known for its red-soled shoes.
The Agnelli family’s Exor holding business is making the 541 million euro ($642 million) investment, which will give them two out of the board’s seven members.
The statement pointed to China and added, “Exor’s drive to growing great companies makes it an appropriate partner for Christian Louboutin at a time when this established brand is set to grasp major new potential.”
More than 150 locations are operated by Louboutin across 30 nations, and the company plans to expand its online presence.
John Elkann, the CEO of Exor, claimed in the statement that he was “quite eager to collaborate in order to hasten the growth of this innovative company. We have a similar family-oriented culture and set of values, which forms the cornerstone of our successful collaboration.”
In 1991, Christian Louboutin founded his company in Paris. His classy women’s shoes soon gained a following, and then he introduced lines for men.
The Economist Group, Shang Xia, PartnerRe, Ferrari, Stellantis, CNH Industrial, GEDI Gruppo Editoriale, and Exor are some of the oldest and biggest holding businesses in Europe, with assets under management estimated to be worth $29 billion.
Why does Ferrari have a S?
The famous Italian air force fighter during World War I, Count Francesco Baracca, was the real owner of the prancer (the cavallino rampante). That identical pattern was printed on the side of his plane. Before being shot down on June 19, 1918, Baracca, who the Italians regarded as their national hero, had won approximately 30 dogfights.
- Considering that his group was a cavalry corps
- owing to the fact that his wealthy family kept horses on their estate
- Considering that he took the artwork from a German pilot’s aircraft that included the Stuttgart city emblem
But it wasn’t until 1923 that Enzo Ferrari met Baracca’s parents, who begged Ferrari to adopt their son’s artwork as a good luck charm on his automobiles.
The yellow backdrop of the emblem represents the city of Modena, Italy, where Enzo was born. Scuderia Ferrari is the name of the company’s racing branch, and the two letters next to the horse, S and F, represent for that. The Italian national colors are represented by the red, white, and green stripes at the top of the emblem.
Interested in thinking about car logos like Ferrari’s? See more of our Behind the Badge series, which explores amazing auto logos!
Ford attempted to purchase Ferrari when?
In order to increase their domestic automobile sales with Ferrari’s participation in the 24 Hours of Le Mans, Ford Motor Company Vice President Lee Iacocca suggests to Henry Ford II in 1963 that they buy the cash-strapped Italian sports and racing car maker Ferrari.
How numerous Ferrari owners are there?
Many of those individuals have owned many Ferraris. Let’s assume that three is the average. Let’s assume that 400,000 or so people have owned one. Given that there are approximately 8 billion people on the earth, roughly 1 person in every 20,000 owns one.
What is the most valued Ferrari?
- Jo Schlesser raced a red 1963 Ferrari 250 GTO in 1960, which was auctioned for $52 million in 2013.
- With a sale price of $70.2 million, another Ferrari 250 GTO in silver blue was the most expensive automobile ever.
Who has the largest collection of Ferraris?
The Sultan Hassanal is not the only member of the royal family that enjoys automobiles. Six 456 GT Venice Ferrari station wagons were ordered by his brother, Prince Jefri. The collection also includes an F90, a 1995 FX (the Sultan requested six of these cars), two 250 GTOs, and an F40, among other notable Ferraris.
There are several, numerous more. actually too numerous to list. The world’s largest automobile collection is so extravagant and lavish that it makes people cringe. However, every vehicle enthusiast must take a moment to collect themselves before leaving this literal sea of luxury due to the collection’s sheer size, worth, and beauty.