Ferrari 8%, Expects Higher Revenue and Earnings This Year

Ferrari N.V. (NYSE: RACE) has reported a strong financial performance for the full year 2024, with net revenues up 11.8% to Euro 6,677 million and net profit up 22.85% to Euro 1,526 million. The company's CEO, Benedetto Vigna, has attributed this success to the "quality of revenues over volumes," driven by a strong product mix and growing demand for personalizations. Looking ahead, Ferrari expects further robust growth in 2025, which will allow it to reach the high-end of its profitability targets for 2026 one year in advance.



Ferrari's financial performance has been bolstered by several factors:

1. Enhanced Product Mix: The introduction of new models such as the Ferrari Purosangue, Roma Spider, and 296 GTS, along with the commencement of shipments for the SF90 XX family and 12Cilindri, has contributed to increased sales.
2. Increased Personalizations: Customers are increasingly opting for personalized features, which has led to higher revenues. This trend is expected to continue, as customers value the exclusivity and uniqueness that personalization offers.
3. Positive Country Mix: The Americas region has contributed significantly to Ferrari's growth, with a 192-unit increase in shipments. This positive country mix is likely to persist, given the region's strong demand for luxury vehicles.
4. New Sponsorships and Lifestyle Activities: Ferrari's sponsorship, commercial, and brand revenues grew by 17.1% due to new sponsorships and lifestyle activities. This trend is expected to continue, as Ferrari continues to explore new partnerships and expand its brand presence.



Investors can expect these trends to continue in 2025, as Ferrari has a strong pipeline of new products, including the once-a-decade F80 hypercar, and plans to maintain its focus on exclusivity, personalization, and brand expansion. Additionally, the company's robust order book, filled through 2026, provides earnings visibility and supports its valuation premium.

In conclusion, Ferrari's strong financial performance and growth expectations make it an attractive investment opportunity. The company's focus on quality over quantity, coupled with its commitment to innovation and personalization, has driven its success and positions it well for continued growth in the coming years. As investors evaluate Ferrari's stock price, they should consider valuation metrics such as the P/E ratio, P/S ratio, and EV/E ratio, and compare them to the company's historical averages and those of its peers in the luxury automotive industry. By doing so, investors can make informed decisions and capitalize on the company's growth potential.