Ferrari (BIT:RACE) shares have caught investors’ attention following a steady performance over the past week, up about 5% compared to the broader auto sector. The company’s consistent growth continues to shape its valuation outlook.
Ferrari’s recent 7-day share price return of 5% stands out in the auto sector, reflecting investor optimism after a year of steady momentum and strong brand-driven performance. The company’s 12-month total shareholder return reinforces a picture of reliable long-term value creation, with momentum building as strategic updates and sector trends catch the market’s attention.
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With Ferrari’s stock up and its fundamentals strong, the key question is whether today’s share price reflects all of its growth potential, or if recent gains mean there is still a buying opportunity for investors.
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Most Popular Narrative: 4.7% Undervalued
With Ferrari's narrative fair value at €447.87, just above its last close at €426.9, expectations are riding high on future growth drivers that could justify a modest premium.
Expanding the model lineup (for example, Amalfi, 296 Speciale, increased customization and personalization offerings) is successfully attracting new ultra-high-net-worth clients globally, especially in underpenetrated regions like China. This supports future revenue growth, average selling price improvements, and long order backlog visibility.
Curious what makes this valuation tick? The answer lies not just in premium car sales, but in global momentum, deep product customization, and ambitious expansion into new markets. Discover which bold financial targets and luxury trends are driving analysts’ optimism. Only the full narrative reveals the numbers and their impact.
However, slower-than-expected progress in electrification and potential demand shifts among luxury buyers could challenge Ferrari’s ambitious growth outlook.
While the narrative perspective sees Ferrari as slightly undervalued, market multiples tell a more cautious story. Ferrari trades at a price-to-earnings ratio of 47.6x, which is far higher than its peers (14.5x), the global auto sector (18x), and above the fair ratio of 20.2x. This sizable premium highlights considerable valuation risk if the market reassesses growth expectations. Are investors overpaying for the Ferrari name, or will future results justify the lofty price?
If you have a different perspective, or want to dive into the numbers yourself, you can easily build a custom narrative in just a few minutes. Do it your way
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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.
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