Why Ferrari (BIT:RACE) Is Down 8.0% After Tepid Targets And Downgrades Challenge Its Growth Story

• In recent weeks, Ferrari has faced pressure after management outlined long-term financial targets that underwhelmed investors, followed closely by consecutive analyst rating cuts tied to concerns over model rollout timing and the electric vehicle roadmap.
• At the same time, Ferrari has been renewing key sponsorships, expanding lifestyle and brand partnerships, and continuing its share buyback programme, underlining management’s focus on monetising its brand strength beyond car sales even as expectations for future growth are reassessed.
• Next, we’ll explore how these underwhelming long-term targets and analyst downgrades could reshape Ferrari’s investment narrative and risk-reward profile.

Outshine the giants: these 26 early-stage AI stocks could fund your retirement.

Ferrari Investment Narrative Recap

To own Ferrari, you need to believe its brand, pricing power, and disciplined scarcity can justify a premium valuation even as growth expectations cool. The key near term catalyst is whether management can restore confidence in its product and EV roadmap after underwhelming long term targets and back to back analyst downgrades. These moves have hit sentiment hard, but they do not yet appear to change Ferrari’s core earnings power or balance sheet strength in a material way.

Among recent updates, the new EUR 350 million revolving credit facility stands out as most relevant. It modestly lowers Ferrari’s cost of capital and extends liquidity, giving the company more flexibility to fund model development, electrification efforts, and brand initiatives while it works through weaker market confidence in its long term growth profile.

Yet, despite the reassuring funding backdrop, investors should still be watching how Ferrari manages the costly transition to hybrid and electric models over the coming years, because...

Read the full narrative on Ferrari (it's free!)

Ferrari's narrative projects €8.8 billion revenue and €2.1 billion earnings by 2028. This requires 8.1% yearly revenue growth and about a €0.5 billion earnings increase from €1.6 billion today.

Uncover how Ferrari's forecasts yield a €404.24 fair value, a 29% upside to its current price.

Exploring Other Perspectives

Fifteen members of the Simply Wall St Community value Ferrari anywhere from €93.64 to €480 per share, with estimates spread widely across the range. Against that backdrop, the recent reset in long term growth expectations and concerns about the EV roadmap give you important context for interpreting where you sit within this spectrum of views.

Explore 15 other fair value estimates on Ferrari - why the stock might be worth as much as 53% more than the current price!

Build Your Own Ferrari Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Ferrari research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Ferrari research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Ferrari's overall financial health at a glance.

Want Some Alternatives?

Opportunities like this don't last. These are today's most promising picks. Check them out now:

• The end of cancer? These 29 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.
• Rare earth metals are the new gold rush. Find out which 36 stocks are leading the charge.
• Trump's oil boom is here - pipelines are primed to profit. Discover the 22 US stocks riding the wave.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com