Ferrari shares plunge to nine-year low on cautious forecast
Ferrari NV shares plunged the most intraday in nine years after the carmaker issued cautious forecasts that disappointed investors, marring a coming-out party for the company’s first electric vehicle.
Adjusted earnings will rise to at least €3.6 billion ($4.2 billion) by 2030 from €2.72 billion this year, the Maranello, Italy-based company said Thursday, News.Az reports, citing Bloomberg.
The outlook implies a slower earnings growth rate than what management offered during their last capital markets day three years ago.
“Investors are likely to interpret a downshift in Ebit growth from prior history,” Tom Narayan, an equity analyst at RBC Capital Markets, said in a note Thursday.
Ferrari fell as much as 16%, the steepest drop since the company listed shares in Milan in January 2016. The stock — trading of which was temporarily halted due to volatility — is now down about 12% for the year.
Expectations were high going into the investor day, with the share of analysts rating Ferrari’s stock a buy at the highest in half a decade. The company trades at multiples more akin to luxury-goods businesses like Hermès International than carmakers, and its shares hit an all-time high in February.
Some analysts were anticipating a potential lowering of EV targets would supercharge Ferrari’s earnings. In a September report, analysts at Deutsche Bank said they expected the company to unveil ambitious mid-term targets, citing prospects for the limited-edition F80 supercar.
Ferrari offered incremental upgrades to its outlook for this year, calling for net revenue to equal or exceed €7.1 billion, up from prior guidance for €7 billion or more. The company bumped up its projection for adjusted Ebitda by 1.5% from at least €2.68 billion previously.
For 2030, Ferrari’s adjusted Ebitda margin of over 40% compares to analysts’ average estimate of 42%, according to Bloomberg Intelligence analyst Michael Dean.
The company’s projections “look light versus high expectations,” Dean said in note. “Targeted free cash of about €8 billion over the five years is also low versus our €9 billion expectation. Shareholder returns of roughly €7 billion — split between dividends and buybacks — look disappointing too.”
Ferrari’s stock was up just over 2% for the year through Wednesday, as the company has been feeling the impact of the broader luxury downturn, tariff uncertainty and slowing sales in China.
Earlier Thursday, Ferrari scaled back its plans to make electric vehicles, even as it unveiled elements of its first EV, the Elettrica, which is set to debut next year. All-electric models will make up about 20% of its lineup by 2030, down from a previous target of 40% set in 2022.
Other luxury-car makers, including Porsche AG and Mercedes-Benz Group AG, have struggled with the electric transition, as wealthy buyers balk at switching over to plug-ins. Like its peers, Ferrari is also trying to regain momentum in China, where its sales have stagnated.
Similar news
