Ferrari (BIT:RACE) Valuation in Focus After Strategic Reset and Sharply Lower Electric Vehicle Targets

Ferrari (BIT:RACE) made headlines after its Capital Markets Day, revealing new strategic and financial guidance. The company raised its 2025 revenue outlook; however, a softer long-term forecast and lower electric vehicle targets weighed on investor sentiment.

See our latest analysis for Ferrari.

The share price reaction was swift after Ferrari’s cautious long-term outlook and halving of its electric vehicle target. Shares have tumbled nearly 16% in the past month, leaving the year-to-date share price return at -16% and total shareholder return over the past year at -21%. Momentum has sharply reversed recently, even though Ferrari’s three- and five-year total shareholder returns remain strongly positive. This reflects resilience over longer horizons.

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Given the stock’s steep pullback and new, more tempered strategy, investors are left debating: Is Ferrari now trading at an attractive level, or are future growth prospects already fully reflected in its price?

Most Popular Narrative: 23.1% Undervalued

The most closely tracked narrative puts Ferrari’s fair value at €447.87, noticeably above its last closing price of €344.20. This suggests that, in the eyes of those following this consensus, the recent market pullback has left Ferrari undervalued against its projected future earnings, global demand, and strategic positioning.

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, ASP improvements, and long order backlog visibility.

Read the complete narrative.

Ferrari’s current valuation rests on more than sheer brand power. This widely followed narrative hints at rising margins, bullish revenue assumptions, and a future profit multiple that breaks away from industry norms. Want to know what bold financial projections drive such a leap in value? The full story is only a click away.

Result: Fair Value of €447.87 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, slower electrification progress and shifting luxury demand patterns could present challenges to Ferrari’s future growth and may put pressure on its profit margins.

Find out about the key risks to this Ferrari narrative.

Another View: Price-to-Earnings Ratios Say Ferrari Is Overvalued

While the consensus sees Ferrari as undervalued, its current price-to-earnings ratio is 38.4x. This figure is much higher than both the global auto industry average of 19x and its peer average of 14.3x, and even exceeds the fair ratio, which stands at 19.9x. Such a large gap signals that Ferrari's shares carry significant valuation risk if expectations stumble, or does this premium simply reflect its exceptional brand strength?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Ferrari Narrative

If you’d rather form your own conclusions, the tools here let you explore Ferrari’s data directly and craft a personalized outlook in just minutes. Do it your way

A great starting point for your Ferrari research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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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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