RACE: Special Series Mix Will Support Premium Multiple And Long Term Upside

Analysts have nudged their fair value estimate for Ferrari slightly lower to about $453 from roughly $456, reflecting a modestly higher discount rate while still expecting solid revenue growth, resilient margins and continued support from premium positioning, new product launches and price mix improvements.

Analyst Commentary

Bullish analysts continue to emphasize Ferrari's unique positioning in the premium and ultra luxury auto segment, arguing that its pricing power, limited volumes and strong brand heritage justify a valuation closer to high end luxury peers rather than traditional automakers. Several recent notes point to upcoming product launches and a richer Special Series mix as key drivers of higher average selling prices and resilient margins, even in a more volatile macro and regulatory backdrop.

At the same time, a series of modest target price trims reflects a recalibration of expectations rather than a fundamental shift in the investment case, with most constructive voices maintaining Buy or Overweight stances. The debate now centers on how quickly Ferrari can convert its long term strategy, including electrification and a value over volume approach, into visible earnings delivery that supports current multiples.

Against this backdrop, the Street remains broadly positive on the long term growth algorithm but increasingly focused on execution risks, cost discipline and the timing of upside to the 2030 financial framework. Diverging views on whether Ferrari deserves a premium or a discount relative to luxury peers are driving a wide range of price targets in both dollar and euro terms.

Bullish Takeaways

• Bullish analysts argue that Ferrari's robust business model, anchored by constrained supply and strong pricing power, supports sustained high margins and makes short term cyclical pressures less relevant to long term valuation.
• New model cycles and an expanding pipeline of higher priced Special Series vehicles are seen as catalysts for mix improvement, allowing Ferrari to lift average selling prices and potentially achieve parts of its 2030 targets ahead of schedule.
• Supportive views highlight Ferrari's evolution toward a luxury brand framework, with some noting that even after recent cuts, fair value implies meaningful upside if the company can narrow the valuation gap to best in class luxury peers.
• Strategic milestones such as the upcoming capital markets events, further clarity on the EV roadmap and potential enhancements to capital return policy are cited as near to medium term drivers that could restore confidence and re rate the shares.

Bearish Takeaways

• Bearish analysts point to rising fixed costs over the next few years, including investments tied to electrification and industrial capacity, as a risk to near term earnings leverage and a reason to temper valuation multiples.
• More cautious views question whether Ferrari should trade at a premium to top tier luxury houses, with some applying explicit discounts to these peers on concerns that execution on the long dated plan could prove slower or more volatile.
• Target price reductions in both dollars and euros underscore skepticism about the pace of earnings growth from current levels, particularly if macro uncertainty in Europe and regulatory changes weigh on demand or cost structures.
• A minority of bears maintain negative recommendations, arguing that the current share price already discounts ambitious growth and margin scenarios, leaving limited room for disappointment on product cadence, EV adoption or capital allocation.

What's in the News

• Ferrari plans to launch a new digital token that will allow its wealthiest clients to participate in an auction for a Ferrari 499P, targeting younger tech entrepreneurs as a key growth audience (Reuters).
• Ferrari has unveiled a new capital return strategy, combining an increased dividend payout ratio of 40% of adjusted net profit from 2025 with authorization for up to €3.5 billion in share repurchases over the coming years.
• The company has raised its 2025 guidance, now expecting net revenues to be greater than or equal to €7.1 billion, and confirmed a 2030 outlook targeting about €9 billion of revenues and at least a 30% EBIT margin.
• Ferrari has completed a major buyback tranche under its 2022 program, repurchasing 5,624,556 shares, or 3.12% of its share capital, for approximately €1.88 billion.
• New and renewed long term partnerships with Philip Morris International and S.Pellegrino strengthen Ferrari's sponsorship roster, deepen its Italian lifestyle branding and expand co-branded experiences around Scuderia Ferrari HP and the Ferrari Challenge Trofeo Pirelli.

Valuation Changes

• Fair Value Estimate has fallen slightly to about $453 from roughly $456, reflecting a modest recalibration rather than a major shift in fundamentals.
• Discount Rate has risen slightly to roughly 14.66% from about 14.56%, modestly increasing the required return applied in the valuation model.
• Revenue Growth has ticked up marginally to around 6.68% from about 6.52%, indicating a slightly stronger long term top line outlook.
• Net Profit Margin has increased slightly to approximately 23.75% from about 23.63%, signaling a modestly more optimistic view on profitability resilience.
• Future P/E has declined slightly to about 49.6x from roughly 50.9x, suggesting a small reduction in the multiple investors are expected to pay for Ferrari's forward earnings.