Ferrari (RACE) Surges 3.8% to Near 52-Week High—What’s Driving the Rally?

• Ferrari (RACE) soars to $505.78, up 3.8% intraday, nearing its 52-week high of $509.13
• Zacks Rank #1 and four consecutive earnings beats fuel investor optimism
• Technicals show RSI at 64.6, MACD bullish crossover, and resistance at $506.76

Ferrari’s breakout day blends strong fundamentals with technical momentum, hitting a 19-month peak. The stock’s surge mirrors broader auto-sector optimism, though its valuation multiples remain contentious despite growth catalysts.

Zacks Rank #1 and Earnings Momentum Ignite Rally
Ferrari’s surge is directly tied to its Zacks Rank #1 (Strong Buy) status, driven by four consecutive earnings beats averaging 10.78% surprise. Analysts raised 2025 EPS estimates by 6.8% to $10.25, highlighting 13.5% revenue growth. The stock’s high valuation (P/E 50.7x) is justified by its luxury sports car niche and Formula One visibility, with upcoming Q3 earnings seen reinforcing growth narratives.

Auto Sector Mixed, But Ferrari Outshines With Strong Fundamentals
While the auto sector faces EV adoption headwinds (exemplified by Fisker’s bankruptcy), Ferrari’s brand premium and limited production insulate it from broader industry pressures. Sector leader Tesla (TSLA) rose 3.6% but trades at a lower P/E multiple, underscoring Ferrari’s luxury valuation premium. The stock’s 3.8% gain reflects its standalone appeal in a volatile sector.

Bullish Technicals and Leveraged Option Play to $520 Strike
• MACD: 4.27 vs 3.83 signal line (bullish crossover)
• RSI: 64.6 (neutral, no overbought alarm)
• Bollinger Bands: Price near upper band ($506.76) signaling strong momentum
• Support: $490.16 (30-day)
• Resistance: $509.13 (52-week high)

Bulls target a breakout above $506.76, with Fibonacci extension at $515.50. The lone active option—RACE20260220C520—offers 101,070% leverage (strike $520) despite low liquidity. Its delta of 1.2% suggests minimal price sensitivity, but gamma of 2.63% amplifies gains if volatility spikes. The theta of -0.001 indicates minimal time decay, making it a speculative hold for long-term bulls.

Trade Alert: Aggressive buyers may nibble RACE20260220C520 if $506.76 resistance holds, but prioritize stop-loss below $495.00.

Backtest Ferrari Stock Performance
The backtest of a 4% intraday surge on the RACE (Rapid Action Cognition and Execution) strategy shows no impact on the entire market, with the maximum return being 0.73% on the maximum return day. This suggests that the surge had a minimal effect on market performance.

Ferrari’s Momentum Holds—Watch for Key Resistance Levels
Ferrari’s rally is sustainable if Q3 earnings confirm growth trajectories, though resistance near $509.13 demands caution. The stock’s P/E premium (50.7x) hinges on margin improvements and EV plans hinted in sector news. With Tesla (TSLA) up 3.6%, sector leadership is contested—but Ferrari’s luxury moat keeps it insulated. Action Item: Fade rallies above $506.76 without volume confirmation, but consider small leveraged positions via options if volatility expands.