Ferrari (NYSE:RACE) Undervalued, Outlook Bullish

Ferrari (NYSE:RACE) Undervalued, Outlook Bullish

Ferrari (NYSE:RACE) Undervalued, Outlook Bullish


Ferrari (NYSE:RACE) is among the world’s leading luxury brands focused on the design, engineering, production and sale of the world’s most recognizable luxury performance sports cars.

The Ferrari brand symbolizes, exclusivity, innovation, state-of-the-art sporting performance and Ital Design.

Its history and the image enjoyed by its cars are closely associated with its Formula 1 racing team, Scuderia Ferrari, the most successful team in Formula 1 history.

Ferrari was spun off from Fiat-Chrysler (NYSE:FCAU) in October 2016, and is gaining a following among investors, as Ferrari has no peers in the automotive world, as it is valued as a luxury firm, and trades 5.5X higher than many other automakers.

Profitability is among the highest of auto makers, with 10-yr EBITDA margins matching Porsche and 62% higher than BMW.

The Big Q: Should Ferrari NV be considered an automotive manufacturer or a manufacturer of luxury products?

My answer is as a manufacturer of luxury products.

As Enzo Ferrari said, “The Ferrari is a dream, people dream of owning this special vehicle and for most people it will remain a dream apart from those lucky few.”


Notably, Ferrari is the auto manufacturer which produced the most expensive car ever sold at auction: the $36-M 1957 Ferrari 335 S Scaglietti Spyder. This model was offered as a Limited Edition of 4.

1964 Ferrari 250 GTO Sells for Record $52M

Ferrari also holds the record for the most expensive car ever sold. According to the available information, a 1963 Ferrari 250 GTO holds that record, carrying a $52-M price in a private treaty transaction.

This type of branding is unequaled in the automotive sector. And brand loyalty is the envy of all automakers, approximately 70% of Y 2015’s sales were to individuals who already owned a Ferrari.

Symbol Last Trade Date Change Open High Low Volume
NYSE:RACE 48.41 12 August 2016 0.36 48.36 48.6 48.26 313,000
HeffX-LTN Analysis for RACE: Overall Short Intermediate Long
Bullish (0.33) Bullish (0.44) Bullish (0.40) Neutral (0.15)9

Have a terrific week.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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