Ferrari's Stock Plummets 4.4% Amid F1 Turmoil and Investor Uncertainty

Summary
• Ferrari (RACE) trades at $358.83, down 4.4% from its $375.35 previous close
• Intraday range spans $356.97 (52W low) to $364.16
• Drivers Charles Leclerc and Lewis Hamilton’s public frustrations with Ferrari’s 2025 F1 performance dominate headlines
• Analysts debate whether the stock’s pullback reflects overvaluation or a strategic reset for 2026 regulations

Ferrari’s stock faces a sharp intraday decline amid a perfect storm of Formula 1 underperformance, driver discontent, and valuation skepticism. With the stock trading near its 52-week low and technical indicators flashing bearish signals, investors are recalibrating expectations for the luxury automaker’s 2026 regulatory reset and driver lineup stability.

F1 Performance and Driver Dynamics Spark Investor Concern
Ferrari’s 4.4% intraday drop reflects investor unease over the team’s 2025 Formula 1 campaign, which saw no grand prix wins and a fourth-place constructors’ finish. Public criticisms from drivers Charles Leclerc and Lewis Hamilton—described as a 'nightmare' by Hamilton—have amplified concerns about team cohesion and performance. Team principal Frederic Vasseur’s insistence that driver criticism is 'part of the job' contrasts with Ferrari chairman John Elkann’s call for 'less talk and more driving,' creating narrative tension. Meanwhile, the stock’s valuation metrics, including a 33.5x P/E ratio and a DCF model suggesting overvaluation by 264%, have drawn scrutiny as the market weighs Ferrari’s long-term growth story against near-term execution risks.

Automotive Sector Mixed as Tesla Drags Down Momentum
The automotive sector remains fragmented, with Tesla (TSLA) down 0.08% despite its dominance in EV innovation. Ferrari’s struggles highlight the sector’s bifurcation: while EV leaders like Tesla focus on production scalability, legacy luxury brands face brand equity and regulatory transition challenges. Ferrari’s 4.4% decline outpaces the sector’s average, underscoring its premium valuation vulnerability amid macroeconomic and regulatory uncertainties.

Bearish Options and ETFs Emerge as Strategic Plays
• 200-day average: $453.56 (well above current price)
• RSI: 34.9 (oversold territory)
• MACD: -7.63 (bearish divergence)
• Bollinger Bands: Price at $358.83, near the lower band ($366.53)

Technical indicators suggest a short-term bearish bias, with the stock trading below all major moving averages and RSI signaling oversold conditions. The 52-week low at $356.97 acts as a critical support level. For aggressive bearish plays, two options stand out:

• RACE20251219P340 (Put Option):
- Strike: $340, Expiry: 2025-12-19
- IV: 34.28% (moderate volatility)
- Delta: -0.165 (low sensitivity)
- Theta: -0.047 (slow time decay)
- Gamma: 0.012 (moderate sensitivity to price swings)
- Turnover: $6,112 (liquid)
- Leverage Ratio: 195.84% (high potential reward)
- Payoff at 5% Downside: $18.83 (max profit if RACE drops to $340.87)
- This put option offers asymmetric upside with high leverage, ideal for a short-term bearish bet on Ferrari’s near-term volatility.

• RACE20260116P350 (Put Option):
- Strike: $350, Expiry: 2026-01-16
- IV: 28.92% (lower volatility)
- Delta: -0.367 (moderate sensitivity)
- Theta: -0.040 (slow decay)
- Gamma: 0.011 (modest sensitivity)
- Turnover: $153,975 (high liquidity)
- Leverage Ratio: 40.27% (balanced risk/reward)
- Payoff at 5% Downside: $9.17 (profit if RACE falls to $340.87)
- This longer-dated put provides a safer, more conservative play on Ferrari’s potential 2026 regulatory reset uncertainty.

Action Alert: Aggressive bears should prioritize RACE20251219P340 for immediate volatility, while RACE20260116P350 suits a more measured approach. Both contracts benefit from Ferrari’s current technical breakdown and narrative-driven sell-off.

Backtest Ferrari Stock Performance
The backtest of RACE's performance after an intraday plunge of at least -4% from 2022 to the present shows favorable short-to-medium-term gains. The 3-Day win rate is 55.90%, the 10-Day win rate is 54.37%, and the 30-Day win rate is 57.42%, indicating a higher probability of positive returns in the immediate aftermath of the plunge. The maximum return during the backtest was 4.88% over 30 days, suggesting that while there is volatility, RACE can exhibit strong recovery and growth in the following weeks.

Ferrari at Crossroads: Watch 2026 Regulatory Reset and Driver Stability
Ferrari’s 4.4% intraday drop underscores the fragility of its premium valuation amid F1 performance concerns and driver uncertainty. While technical indicators suggest oversold conditions, the stock’s path forward hinges on the 2026 regulatory reset and Leclerc’s potential exit. Investors should monitor the $356.97 52-week low and key news on Ferrari’s 2026 car development and driver lineup. Meanwhile, Tesla’s -0.08% move highlights the sector’s mixed momentum. Act Now: Position in RACE20251219P340 for a short-term bearish play or RACE20260116P350 for a longer-term bet on Ferrari’s strategic reset.