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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