Ferrari Stock Dips Despite Strong Quarterly Results
Ferrari stock took a hit on Tuesday despite the Italian luxury automaker releasing third-quarter results that met expectations. While revenue and profit grew, vehicle deliveries fell short, leading investors to sell off shares.
Key Takeaways from Ferrari’s Q3 Report
* **Revenue Increased:** Ferrari reported €1.64 billion ($1.79 billion) in revenue for the third quarter, a 7% increase year-over-year and in line with analyst estimates.
* **Profit Growth:** Adjusted EPS came in at €2.08 ($2.27), also meeting estimates, and adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) was €638 million ($695 million), up 7% and slightly ahead of street expectations.
* **Delivery Slump:** Despite the revenue and profit gains, deliveries dropped 2% year-over-year to 3,383 units. China shipments, in particular, tumbled 22%.
* **Guidance Retained:** Ferrari reaffirmed its full-year guidance, predicting revenue of €6.55 billion ($7.14 billion) and adjusted EBITDA of €2.50 billion ($2.73 billion).
China Demand Slowdown Impacts Ferrari
Ferrari’s stock drop comes amid a broader trend of luxury automakers struggling with softening demand in Asia. Porsche, for example, experienced a 29% decline in sales from China during the same period.
However, Ferrari is in a comparatively better position than its rivals due to its smaller reliance on the Chinese market, which accounts for only 8.3% of its shipments.
Ferrari CEO Benedetto Vigna remains optimistic, highlighting the company’s strong product mix and order book visibility into 2026.
Wall Street Remains Cautious Despite Strong Performance
While some analysts remain bullish on Ferrari’s long-term prospects, others are more cautious. CFRA’s Garrett Nelson raised his price target for Ferrari to $460 from $440, citing prospects for 2025 P/E ratio growth. However, he maintained a Hold rating, citing the current valuation.
“RACE continues to boast one of the strongest earnings track records (now 17 straight earnings beats), but we view the shares as fairly valued at current levels,” Nelson said.
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