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Ferrari NV (IT:RACE)
:RACE
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Ferrari
(RACE)
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Rating:77Outperform
Price Target:
€311.00
▲(13.38% Upside)
Action:ReiteratedDate:02/21/26
The score is primarily supported by exceptional profitability and strong cash generation, reinforced by positive earnings-call guidance and long order-book visibility. It is tempered by mixed technical positioning (below longer-term moving averages) and a relatively expensive valuation (P/E ~34.5 with a low dividend yield).
Positive Factors
Premium Profitability
Sustained high margins reflect durable pricing power and model-level profitability that support returns and reinvestment. These margins provide a structural cushion against cost inflation and cyclical demand swings, enabling consistent funding of R&D, product launches and shareholder distributions.
Strong Cash Generation
Robust operating and free cash flow underpin long-term financial flexibility, funding capex, product development and shareholder returns without overreliance on external funding. Even with moderate FCF conversion, sustained cash generation materially reduces execution risk on launches and supports balance-sheet resilience.
Brand, Order Book & Product Pipeline
A strong brand and visible backlog provide durable demand visibility and allow disciplined volume management to protect exclusivity. Deep personalization revenue and a multi-model rollout (several launches in pipeline) support higher ASPs and recurring after-sales revenue, bolstering long-run margin mix.
Negative Factors
Material Leverage
Meaningful net debt increases financial exposure to rate or demand shocks and limits optionality on big strategic moves. While leverage has improved from prior years, the existing debt stock can amplify earnings volatility and constrain capex or buybacks if cash generation weakens.
Currency & Tariff Exposure
Significant FX and tariff sensitivity creates lasting earnings volatility across reporting periods and can erode margins even with local hedges. Persistent currency shifts or higher import duties in key markets can structurally reduce profitability and complicate long-term planning for pricing and sourcing.
Rising Operating Costs & Model Changeover
Higher brand, digital, R&D and racing costs alongside depreciation increase fixed cost base and may compress margins over the medium term. Simultaneous model ramps and phaseouts can depress near-term unit economics and delay cash conversion, adding structural execution risk during transitions.
Ferrari (RACE) vs. iShares MSCI Italy ETF (EWI)
Market Cap
$64.85B
Dividend Yield0.93%
Average Volume (3M)613.04K
Price to Earnings (P/E)35.5
Beta (1Y)0.86
Revenue Growth9.53%
EPS Growth12.89%
CountryIT
Employees5,465
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Manufacturers
Share Statistics
EPS (TTM)2.14
Shares Outstanding193,923,500
10 Day Avg. Volume430,746
30 Day Avg. Volume613,040
Financial Highlights & Ratios
PEG Ratio5.89
Price to Book (P/B)14.53
Price to Sales (P/S)7.94
P/FCF Ratio30.45
Enterprise Value/Market Cap0.78
Enterprise Value/Revenue7.03
Enterprise Value/Gross Profit13.61
Enterprise Value/Ebitda19.40
Forecast
1Y Price Target
$382.71Price Target Upside39.52% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
EPS Forecast (FY)9.62
Revenue Forecast (FY)$7.54B
Ferrari Business Overview & Revenue Model
Company DescriptionFerrari N.V., through its subsidiaries, designs, engineers, produces, and sells luxury performance sports cars. The company offers sports, GT, and special series cars; limited edition hyper cars; one-off and track cars; and Icona cars. It also provides racing cars, and spare parts and engines, as well as after sales, repair, maintenance, and restoration services for cars. In addition, the company licenses its Ferrari brand to various producers and retailers of luxury and lifestyle goods; Ferrari World, a theme park in Abu Dhabi, the United Arab Emirates; and Ferrari Land Portaventura, a theme park in Europe. Further, it provides direct or indirect finance and leasing services to retail clients and dealers; manages racetracks, as well as owns and manages two museums in Maranello and Modena, Italy; and develops and sells a line of apparel and accessories through its monobrand stores. As of December 31, 2021, it had a total of 30 retail Ferrari stores, including 14 franchised stores and 16 owned stores. The company also sells its products through a network of 172 authorized dealers operating 191 points of sale worldwide, as well as through its website, store.ferrari.com. Ferrari N.V. was founded in 1947 and is headquartered in Maranello, Italy.
How the Company Makes MoneyFerrari primarily makes money by selling luxury sports cars and related services. Its key revenue streams include: (1) Sales of cars: Revenue from delivering Ferrari-branded vehicles to customers, typically through a controlled network of authorized dealers and a production strategy aimed at maintaining brand exclusivity. This also includes revenue associated with optional features and bespoke customization programs that increase the average selling price per vehicle. (2) Sponsorship, commercial, and brand revenue (including Formula 1): Ferrari earns income from commercial arrangements tied to its motorsport activities—most notably Formula 1—such as sponsorships and other promotional/marketing rights associated with the team and its global visibility; where applicable, this can also include motorsport-related participation and prize-related distributions, depending on the governing agreements. (3) Licensing, royalties, and brand-related activities: Ferrari monetizes its brand through licensing agreements that generate royalties from Ferrari-branded merchandise and other approved uses of its intellectual property. (4) Services and other: Ferrari generates revenue from after-sales support, spare parts, maintenance-related services delivered through its authorized service network, and other ancillary activities linked to its vehicles and customer ecosystem. Significant factors influencing earnings include the strength of the Ferrari brand (which supports premium pricing), the mix of higher-margin models and personalization, disciplined volume management to preserve exclusivity, and the scale and quality of commercial partnerships associated with Formula 1 and licensed brand activities.
Ferrari Earnings Call Summary
Earnings Call Date:Feb 10, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 05, 2026
Earnings Call Sentiment Positive
The call highlighted strong financial and operational performance in FY2025 — record revenue (>EUR 7.1bn), robust margins (EBIT margin 29.5%), and exceptional industrial free cash flow (+~50% to >EUR 1.5bn), together with successful product launches and racing achievements. Key near-term headwinds include an acknowledged EUR ~200m FX drag for 2026, tariff impacts, higher SG&A and R&D/F1 costs and model-changeover timing that creates delivery phasing risk. On balance, the company demonstrated execution strength, ample cash generation and a clear strategic roadmap, while flagging manageable but meaningful macro and timing challenges for 2026.Q4-2025 Updates
Positive Updates
Record Revenue
Net revenues exceeded EUR 7.1 billion in FY2025, representing year-over-year growth of ~8% at constant currency (7% including FX headwinds).
Strong Profitability and Margins
EBIT surpassed EUR 2.1 billion (double-digit growth year-over-year) with an EBIT margin of 29.5% and an EBITDA margin of 38.8% for FY2025.
Industrial Free Cash Flow Surge
Industrial free cash flow exceeded EUR 1.5 billion in 2025, up roughly 50% versus the prior year, supported by increasing profitability and positive working capital dynamics.
Shareholder Remuneration and Buyback Completion
Shareholder returns totaled over EUR 1.3 billion (roughly +30% year-over-year) in dividends and repurchases, and the EUR 2 billion share buyback program was concluded one year ahead of schedule.
Successful Product and Technology Push
Launched six new sports cars in 2025 (including the flagship Ferrari Luce full-electric reveal steps and five additional ICE/hybrid models such as the Amalfi, 849 Testarossa, 296 Speciale and Speciale Aperta), demonstrating horizontal product diversification and technology neutrality.
Racing Triumphs
499P hypercar secured the 2025 FIA World Endurance Championship—Ferrari won both World Manufacturer's and Driver's titles—reinforcing brand performance and technical capability.
Strong Demand Visibility & Client Engagement
Order book provides visibility into the end of 2027; personalization remained important (~20% of cars & spare-parts revenues); museum attendance nearly 900,000 visitors, evidencing strong lifestyle engagement.
Operational and Cost Tailwinds in Q4
Q4 benefited from a lower-than-anticipated cost base, positive product mix, an R&D government grant and reduced racing expenses, allowing the company to exceed 2025 guidance.
Negative Updates
Significant FX Headwind for 2026
Management expects an approximately EUR 200 million negative impact to 2026 results from foreign exchange (assumption: USD ~120/EUR and current JPY rates) after considering hedges.
Tariff and Currency Dilutive Impacts
Increased U.S. import duties and adverse currency moves (USD and JPY) were cited as dilutive to margins in 2025 and remain a headwind for 2026.
Higher Operating Costs and Investment
SG&A is expected to rise (brand, digital transformation, organizational investments) and depreciation/amortization to increase with new model production; R&D and F1-related innovation costs present potential volatility in 2026 P&L.
Model Changeover Volatility and Delivery Phasing
2025–26 transition included multiple model phaseouts (e.g., Daytona SP3) and seven new models entering production; management deliberately kept shipments flat in 2025 which, combined with changeover timing, creates delivery phasing and short-term volatility.
Geographic and Dealer-Level Softness (UK & US Timing)
Residual value concerns prompted a targeted ~30% shipment reduction to the U.K.; U.S. deliveries declined materially in Q4 (management framed as allocation/changeover rather than weak demand).
Limited Near-Term Visibility on Personalization & Sponsorship
Personalization and sponsorship revenues have shorter visibility (personalizations typically finalized 4–5 months before delivery) and can introduce variability quarter-to-quarter; guidance assumes personalizations around 20% of car & spare parts revenues.
F80 Ramp-Up and Low Early Volume
F80 production started and a few units were delivered in Q4, but management provided limited visibility on ramp pace; new model ramps (including Ferrari Luce deliveries only beginning in Q4 2026) may delay contribution to near-term volumes.
Net Working Capital & CapEx Profile for 2026
2025 benefited from F80 advance collections boosting working capital; 2026 net working capital is expected to be more neutral and CapEx is anticipated to be slightly higher than 2025, potentially moderating industrial free cash flow growth versus the strong 2025 comparables.
Company Guidance
Ferrari guided 2026 as “another year of growth,” driven by a stronger product mix (with the clearest improvement in H2) and model ramp‑ups, while expecting personalizations to remain around 20% of cars & spare‑parts revenues; higher SG&A (brand, retail and digital), higher D&A, roughly stable R&D on the P&L (with possible F1 volatility) and CapEx slightly above 2025. Management assumes a USD ≈120/EUR rate and flagged a net FX headwind of about €200m (including hedges), an effective tax rate of ≈23% (Patent Box benefit only), and expects industrial free cash flow to stay robust after 2025’s >€1.5bn (≈+50% YoY) generation; 2025 base metrics were revenues >€7.1bn, EBIT >€2.1bn (EBIT margin 29.5%, EBITDA margin 38.8%), shipments kept flat YoY, order book visibility into end‑2027, and the continuation of new‑model launches (7 in production) including F80 ramp and Ferrari Luce full introduction (deliveries starting Q4).Ferrari Financial Statement Overview
Summary
High-quality financial profile driven by premium profitability (TTM gross margin ~52%, EBIT margin ~30%, net margin ~22%) and strong, improving cash generation (TTM FCF ~€1.52B). Offsetting factors include a not-fully-conservative balance sheet with meaningful debt (~€3.0B; TTM debt-to-equity ~0.76) and only moderate FCF conversion (~58% of net income).Income Statement
Ferrari shows premium-level profitability and resilience. In TTM (Trailing-Twelve-Months), revenue reached ~€7.15B with strong gross (~52%) and net (~22%) margins, and operating profitability remains exceptional (EBIT margin ~30%). Revenue and earnings have generally trended upward from 2020–TTM, with only the 2020 decline standing out as a historical softness; recent growth remains positive but the TTM revenue growth figure appears unusually high versus prior years, suggesting potential volatility or comparability noise.92
Very Positive
Balance Sheet
Balance sheet quality is solid but not conservative. Leverage has improved versus 2020–2022, with debt-to-equity down to ~0.76 in TTM (Trailing-Twelve-Months) (from ~1.53 in 2020), and equity has expanded alongside asset growth. Returns to shareholders are extremely strong (ROE ~44% TTM), a major positive, though it can be amplified by leverage; total debt remains meaningful at ~€3.0B, so the capital structure still introduces some risk if conditions tighten.78
Positive
Cash Flow
Cash generation is strong and improving. TTM (Trailing-Twelve-Months) operating cash flow was ~€2.35B and free cash flow ~€1.52B, up sharply versus 2024, supporting flexibility for reinvestment and shareholder returns. Operating cash flow covers reported profits well (over 1x), but free cash flow conversion is more moderate (free cash flow is ~58% of net income TTM), indicating ongoing capital needs and/or working-capital swings that can temper how much accounting profit turns into cash.84
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 7.15B | 6.68B | 5.97B | 5.10B | 4.27B |
| Gross Profit | 3.69B | 3.35B | 2.97B | 2.45B | 2.19B |
| EBITDA | 2.13B | 2.59B | 2.29B | 1.77B | 1.53B |
| Net Income | 1.60B | 1.52B | 1.25B | 932.61M | 830.77M |
Balance Sheet | |||||
| Total Assets | 9.86B | 9.50B | 8.05B | 7.77B | 6.86B |
| Cash, Cash Equivalents and Short-Term Investments | 1.55B | 1.75B | 1.13B | 1.40B | 1.35B |
| Total Debt | 3.02B | 3.35B | 2.48B | 2.81B | 2.63B |
| Total Liabilities | 5.95B | 5.95B | 4.98B | 5.16B | 4.65B |
| Stockholders Equity | 3.91B | 3.53B | 3.06B | 2.59B | 2.21B |
Cash Flow | |||||
| Free Cash Flow | 1.86B | 937.50M | 847.73M | 598.72M | 545.58M |
| Operating Cash Flow | 2.35B | 1.93B | 1.72B | 1.40B | 1.28B |
| Investing Cash Flow | -944.14M | -987.11M | -866.45M | -805.41M | -732.74M |
| Financing Cash Flow | -1.67B | -324.76M | -1.11B | -553.56M | -579.67M |
Ferrari Technical Analysis
Negative
274.30
Price Trends
300.28
Negative
317.65
Negative
360.34
Negative
Market Momentum
-5.82
Positive
32.49
Neutral
16.21
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:RACE, the sentiment is Negative. The current price of 274.3 is below the 20-day moving average (MA) of 302.16, below the 50-day MA of 300.28, and below the 200-day MA of 360.34, indicating a bearish trend. The MACD of -5.82 indicates Positive momentum. The RSI at 32.49 is Neutral, neither overbought nor oversold. The STOCH value of 16.21 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IT:RACE.
Ferrari Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | €3.78B | 11.06 | ― | 3.23% | -0.22% | -12.64% | |
77 Outperform | $64.85B | 35.48 | 43.22% | 0.93% | 9.53% | 12.89% | |
74 Outperform | €14.01B | 24.08 | 18.89% | 2.32% | 0.87% | -5.61% | |
66 Neutral | €5.55B | 11.72 | 8.81% | 4.33% | 1.64% | 14.73% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
48 Neutral | €20.97B | -1.22 | 26.27% | 7.23% | -17.07% | -118.99% | |
46 Neutral | €58.99M | -54.82 | -26.84% | ― | -9.84% | -4133.33% |
* Consumer Cyclical Sector Average
IT:RACE
Ferrari
274.30
-125.38
-31.37%
IT:STLAM
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5.57
-4.82
-46.36%
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-10.23%
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51.74
-6.97
-11.87%
IT:PINF
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IT:PIRC
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5.55
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.