Ferrari (NYSE:RACE) Finishes on All-time Highs
There is no automotive brand in the world with the prestige of Ferrari.
In Y 1939 Enzo Ferrari created the iconic Italian company, known as the Maranello Outfit. And to this day wealthy aficionados que up to acquire the latest Special Edition Super and HyperSupercars, priced in the millions of dollars.
In October 2015 the company debuted on the NYSE with the ticker RACE after being spun off by Fiat Chrysler (NYSE}:FCAU) forming Ferrari N.V.
Since it’s listing, the stock has performed extremely well relative to its peers (none) and the wider market.
YTD, Fiat Chrysler Automobiles and Ferrari delivered the best returns of any car company.
Fiat Chrysler advanced 31.5% to and Ferrari surged 63.5%.
Ferrari sell cars to a different demographic than other US-traded companies, including Tesla (NASDAQ:TSLA).
The cheapest Ferrari model was $188,425 in Y 2016, with the highest-priced running in the $400,000 range.
The most expensive classic car sold at public auction in history was a 1922 50 GTO made for Sir Stirling Moss that hammered for $38,115,000 in Y 2012.
My experience and research shows that Tier 1 classic cars are the best investment for returns, with as much as a 28% return over 12 months, and 467% over 10 years. Ferrari buyers have been willing to put a lot of money behind some of the truly iconic Ferrari sports and racing cars.
Ferrari has strong pricing power.
Only a handful of the latest models, the LaFerrari Aperta and the GTC4Lusso, are being made, which tells us how demand for super luxury cars has never been greater.
And the numbers are there to prove it.
The market is pricing RACE at a lofty 35X forward price earnings multiple.
This is for good reason since its forward EV/ EBITDA is much higher than its peers (none)
Looking ahead Ferrari estimates that about 8,400 units will be shipped in Y 2017, 5% more than Y 2016.
Management has set a target to reduce debt levels to EUR500-B from EUR653-B. And from a marketing standpoint, its F1 racing team is performing well this season.
Ferrari is both highly cyclical and defensive, meaning whether in recessionary periods or boom times, there will always be people with money who want to buy Ferrari’s.
|NYSE:RACE||97.24||19 July 2017||2.09||95.24||97.45||95.23||1,088,790|
|HeffX-LTN Analysis for RACE:||Overall||Short||Intermediate||Long|
|Bullish (0.41)||Bullish (0.27)||Very Bullish (0.54)||Bullish (0.42)|