“The Maranello Outfit is Preparing for an Electrified Future“– Paul Ebeling
Ferrari’s new CEO Benedetto Vigna has put in place a team that he feels he can trust to lead Ferrari into the future.
Transitions like this have the potential to be difficult at Ferrari, a company steeped in tradition that is also something of an Italian national icon.
That is why CEO Vigna brought in 2 of his longtime associates from STMicroelectronics, they are people he knows that he can trust to execute his vision.
They will have to be navigated carefully. Ferrari has always embraced new technologies that were developed in racing, but it has been relatively slow to explore fully electric powertrains, automated driving technologies, and connected-vehicle systems all technologies that come from outside of its traditional areas of expertise.
Ferrari’s brand was built on its racetrack successes and on the sounds and sensations of its V-12 and V-8 gasoline engines. While the company has embraced emissions-friendly technologies like turbocharging and, more recently, gasoline-electric hybrid drivetrains, it has yet to show a fully electric vehicle or even talk about what one might look like, though it did tell us last year that we can expect an electric Ferrari by Y 2025.
Ferrari will share more details about its plans during its annual capital markets day in June.
Ferrari is The Aristocrat of the automotive sector.
Ferrari is 1 of the most recognizable brands in the world, even becoming the world’s strongest luxury brand in Y 2021, according to Brand Finance. Its Brand Strength Index scored 93.9 pts out of 100 and has a brand strength of AAA+.
Our overall technical outlook is still Bullish, all Key indicators are Bullish long-term. Ferrari reported strong earnings for Q-3 on 3 November and did the same for Q-4 and F-Y 2020 as reported on 2 February.
Ferrari finished Monday at 254.22 within its 52 wk range of 127.73 – 275.30 in NY, down from its all time closing high at 275.30 on 22nd November.
Key technical indicators are Neutral-Bullish in here. The candlestick pattern indicated the confirmation of the break out at 196.01 on 3 November and confirmed.
The Key resistance is at 258.38, the Key support is at 253.10, our Key technical indicators are now Neutral-Bullish.
Societe Generale places a Street high price target of $290 on RACE as compared to the average sell-side price target at 195.93. Most Street analysts still do not know how to view Ferrari.
Morgan Stanley called out $RACE a “sleeper” EV play as the firm can justify more than 100% of the company’s value with its ICE business. MS’s new price target of $350 reps more than 35% Northside potential for shares and is above the average analyst 1 yr target is at 208.64.
MS automotive analyst says, “Longer term, we see scope for Ferrari to offer a range of EV products at potentially higher prices than the average selling price of today’s Ferrari, while leveraging economies of scale on higher volumes.“
Note: At the beginning of Y 2020 I called RACE at 230 by year’s end, the stock was trading at 165.22 on 1 January 2020, on 29 December 2020 it marked 233.66 intraday, an all time high
The Maranello Outfit’s shares were raised to Buy from Hold at HSBC, and Buys at Morgan Stanley and Bank of America.
UBS is now calling the stock at 365. I have not seen any other Street downgrades.
Ferrari will continue to create value in the long term as it becomes the world’s 1st Super Luxury brand.
Ferrari is a quality 1st long term luxury products investment, BAML raised its call to 270 long term.
I have raised my long term target to 375, a Strong Bull call, the strongest on the Street and am holding the mark during this recent profit taking, and seeing RACE as a buying opportunity.
Ferrari has an average rating of Buy and a consensus target price at 208.29.
Ferrari will continue to create value in the long term. Ferrari is a quality 1st long term luxury products investment, and I am calling it 375 long term, the Top call on the Street, and adjusting it to 250/share short term.
A number of large investors have recently bought shares of RACE, and there have been very few instances of insider selling over the past yr that we have seen. And Ferrari continues to buy back its stock in here.
The stock is considered defensive in the sector.
Have a prosperous week, Keep the Faith!