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Latest F1: Ferrari’s (NYSE:RACE) Monaco Trouble

#Ferrari #F1 #Monaco #Leclerc #Binotto

$RACE

Ferrari (NYSE:RACE) did not gamble with Charles Leclerc’s gearbox, and his driveshaft issue on the way to the grid might not have been a result of his crash in qualifying at the Monaco Grand Prix, according to team boss Mattia Binotto.

Mr. Leclerc crashed at the end of Q3 bringing out the Red flags that secured him Pole position. After extensive checks overnight and on Sunday morning, Ferrari stated that the gearbox was showing no signs of damage and did not need to be changed, following comments from Boss Binotto that the Scuderia would not take any risks with reliability.

However, Mr. Leclerc radioed in with a problem on his 1st lap out of the garage Sunday and what turned out to be a left driveshaft issue caused him to fail to start his home race.

It was a failure on the left hub – driveshaft – something that we need to carefully analyze, but it is not gearbox related,” Mr. Binotto said. “If we would have changed the gearbox, those parts would still have been on the car because they were not damaged from the accident and the failure would still have happened.

So it is not a matter of gambling with the gearbox, the gearbox was OK and the gearbox did not fail. On our side we need to understand what happened, why it happened, and more than that if we could have detected it in parc ferme … so it’s important to understand why we didn’t detect a problem on the car.

The problem started to appear in Turn 6, so the part on the car was not showing any cracks but the cracks happened already only later, so that is something we can only analyze by looking at the parts in the next days and all the data.”

Boss Binotto believes there’s a chance the crash had nothing to do with the damage, but is not willing to say for sure that it was not a problem that was overlooked after the accident.

So no, I’m not, eventually it could be related to the accident,” he added. “It’s not a gearbox failure, that’s for sure, so it is not a matter of gambling with the gearbox itself. I think that all the inspections we made were right, the gearbox was safe and working properly. It is something else.

“Is it a consequence or not? I don’t know, honestly, right now. Could we have detected it or not? Again it is something we need to analyze and eventually find an answer, but it was on completely the opposite side, on the other corner, but again maybe not related or maybe it is and that will be part of the analysis in the next days.”

Ferrari is The Aristocrat of the automotive sector.

Enzo Ferrari’s iconic Italian Supercar manufacturer claimed the title according to the latest Brand Finance Global 500 2019 report launched at the World Economic Forum in Davos

Our overall technical outlook is still Bullish, a 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 at 212.52 within its 52 wk range of 127.73 – 233.66 Wednesday in NY. It’s all time high in NY was marked at 233.66 intraday on 29 December.

Key technical indicators are now Bullish to Very Bullish long term. The candlestick pattern indicates the confirmation of the break out at 196.01 on 3 November and confirmed.

The Key support is at 208.19 and the Key resistance is at 217.02. The 14 May DOJI candlestick augurs a move further North.

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, its 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. Citi downgraded the stock from Neutral to sell. 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 231.99.

The Maranello Outfit’s shares were raised downgraded from Buy to Hold at HSBC.

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 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 healthy day, Keep the Faith!

Paul Ebeling
Paul A. Ebeling, a polymath, excels, in diverse fields of knowledge Including Pattern Recognition Analysis in Equities, Commodities and Foreign Exchange, and he is the author of "The Red Roadmaster's Technical Report on the US Major Market Indices, a highly regarded, weekly financial market commentary. He is a philosopher, issuing insights on a wide range of subjects to over a million cohorts. An international audience of opinion makers, business leaders, and global organizations recognize Ebeling as an expert.   

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