Ferrari’s (NYSE:RACE) Luxury Supercar Demand Spikes

Ferrari’s (NYSE:RACE) Luxury Supercar Demand Spikes

Ferrari’s (NYSE:RACE) Luxury Supercar Demand Spikes

$RACE

Ferrari (NYSE:RACE) the Italian supercar maker plans to boost production by 2Xing assembly shifts to 2 a day in Y 2018 as deliveries are on pace to reach its 9,000-vehicle target a year earlier than schedule.

The increase is part of CEO Sergio Marchionne’s, 65 anni, plan to boost profit by expanding Ferrari’s line-up while maintaining the exclusivity of its $200,000 Portofino (seen above) -and-up models.

Mr. Marchionne will present Ferrari’s latest mid-term strategy early next year, his final one at the helm of the Italian iconic marque.

The plan will include Ferrari’s 1st-ever FUV (Ferrari Utility Vehicle) as it targets annual sales exceeding a self-imposed 10,000-car limit that until now has enabled it to operate under less-stringent fuel-economy rules.

Goals include 2Xing operating profit to about $2.35-B by Y 2022.

Ferrari raised its Y 2017 profit target last month as its Limited Edition Supercars, including the HyperSupercar FXX K Evo racing model (seen above), help it achieve a long-held profit goal 2 years early.

Adjusted earnings before interest, taxes, depreciation and amortization will total about EUR1-B this year.

Ferrari planned to reach full-year sales of 9,000 cars in Y 2019, according to filings for the carmaker’s IPO in October 2015.

Ferrari stock has more than 2X’d since its debut on the NYSE, and its 83% gainer this year marks the best performance among all automakers in Y 2017, to value the company at $20.1-B.

Sales growth is being driven as the population of wealthy individuals expands.

The number of millionaires worldwide 36% to 13.6-M people in the 10 years through Y 2016 and may rise another 37% in the following decade, according to the Wealth Report by real estate company Knight Frank.

Notably, one need be much more than a millionaire to afford a Ferrari Supercar.

The number of billionaires increased 45% in the period, boosted by gains in the Asia-Pacific area.

Ferrari’s production could increase about 7% to 9,000 cars in Y 2018 from about 8,400 this year.

Ferrari has a waiting list of more than 12 months for most of its models.

To preserve its exclusivity, Ferrari should always sell 1 car less than the market demand, founder Enzo Ferrari declared.

A Ferrari spokesman declined to comment.

Meeting the stated goal will likely drive Ferrari share to 200 and beyond. I am Bullish to Very Bullish long term.

Symbol Last Trade Date Change Open High Low Volume
NYSE:RACE 106.99 12 December 2017 0.55 106 107.38 105.93 486,584
HeffX-LTN Analysis for RACE: Overall Short Intermediate Long
Neutral (-0.16) Neutral (-0.11) Neutral (-0.21) Neutral (-0.15)

Stay tuned…

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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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