Ferrari's First Electric Car Launch Draws Criticism
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 hours ago
0mins
Source: Yahoo Finance
- Electric Car Launch Reaction: Ferrari's unveiling of the Luce, its first fully electric vehicle, resulted in a 6.03% drop in stock price on the Borsa Italiana, indicating negative market sentiment towards its minimalist design, which could impact brand perception and future sales.
- Pricing and Performance: Priced at €550,000, the Luce features four electric motors and a range of 530 km; although management claims it will be profitable from launch, the high price point may limit market acceptance and sales volume.
- Target Customer Shift: Approximately 50% of attendees at the launch event were first-time buyers, compared to the typical 10% to 20%, indicating a strategic shift by Ferrari to attract new customers, which could affect its long-term customer base and loyalty.
- Electric Vehicle Target Reduction: Ferrari has lowered its target for electric models to 20% of its lineup by 2030 from a previous goal of 40%, reflecting concerns over weak luxury demand, which may diminish its competitiveness in the electric vehicle market.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy RACE?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on RACE
Wall Street analysts forecast RACE stock price to rise
15 Analyst Rating
11 Buy
3 Hold
1 Sell
Moderate Buy
Current: 348.240
Low
349.74
Averages
448.83
High
555.00
Current: 348.240
Low
349.74
Averages
448.83
High
555.00
About RACE
Ferrari NV, known as Ferrari, is an Italy-based designer, manufacturer and retailer of sports cars that is incorporated in the Netherlands. It operates under the Ferrari brand. Its sports cars portfolio includes, among others, F12berlinetta, FF, Ferrari 488 GTB, 488 Spider, 458 Speciale, Ferrari California T, F12tdf and LaFerrari. The Company also offers financing services through Ferrari Financial Services. It also produces limited series and one-off cars. The Company divides its regional markets in EMEA (Europe, the Middle East, India and Africa), Americas, Greater China and Rest of APAC (Asia-Pacific region, excluding Greater China) and is active in over 60 markets worldwide through a network of authorized dealers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Ferrari's New EV Luce Sparks Controversy
- Design Transformation: Ferrari's Luce EV, developed in collaboration with former Apple designer Jony Ive, features a five-seat, four-door layout, marking a significant shift in the brand's electrification strategy, although this has raised concerns about the brand's traditional sports car identity.
- Declining Deliveries: The company reported a 4.4% year-on-year decline in first-quarter deliveries to 3,436 units, yet maintained a strong EBITDA margin above 39%, indicating ongoing demand for personalized vehicle features.
- Cautious Market Reaction: Following the Luce's unveiling, Ferrari's stock dropped 3% on Monday as investors expressed concerns over the brand's aggressive shift towards electrification, fearing it may compromise the brand's exclusivity and racing heritage.
- Potential Cost Pressures: Investors are worried that new U.S. tariffs on European car imports could increase costs for Ferrari in North America, potentially forcing the company to raise car prices or absorb additional costs, which could negatively impact profit margins.
See More
Midday Trading Highlights in US Stocks
- Micron Technology Surge: Micron's shares soared nearly 18%, elevating its market cap to $1 trillion, as UBS raised its price target from $535 to $1,625, indicating a potential doubling of share value, reflecting strong market confidence in the semiconductor sector.
- Semiconductor Sector Rally: The VanEck Semiconductor ETF (SMH) rose over 3%, reaching a new 52-week high, with On Semiconductor and Western Digital both gaining nearly 9%, showcasing investor optimism regarding the recovery of the chip industry.
- Oklo Nuclear Tech Progress: Oklo's stock increased by 6% after being selected by the Department of Energy for discussions on using Cold War-era plutonium as fuel, indicating the company's strategic collaboration potential in the nuclear energy sector.
- Modine Manufacturing Agreement: Modine's shares jumped 16% after announcing a $4 billion agreement with a strategic data center customer, expected to significantly enhance revenue and market position through 2029.
See More
Ferrari's New EV Launch Triggers Stock Decline
- Stock Reaction: Ferrari's shares fell as much as 6% on Nasdaq following the unveiling of its new EV, Luce, indicating negative market sentiment regarding its design, which may impact short-term sales performance.
- Analyst Insights: Evercore ISI analyst suggests that despite initial poor reactions, Luce could attract new customers, maintaining an outperform rating with a $475 price target, representing a 36% upside potential.
- Public Feedback: The design of Luce faced criticism on social media, with some users labeling it as one of the ugliest EV designs, which could deter potential buyers and exacerbate market concerns.
- Market Outlook: Although demand for luxury EVs remains low, Bernstein analysts believe that the launch of Luce could stimulate sales, projecting an expanded customer base for Ferrari, with an outperform rating and a $402 price target, suggesting a 15% upside.
See More
Key Highlights from Tuesday's Investing Club Meeting
- Market Rally: The S&P 500 rose on Tuesday, primarily driven by technology stocks like Micron, Western Digital, and Seagate, reflecting investor optimism about a potential U.S.-Iran deal to end the conflict.
- Arm Stock Trim: Following a 46% gain last week, Jim Cramer decided to trim his position in Arm, emphasizing the importance of taking profits rather than chasing parabolic moves to maintain portfolio stability.
- Eli Lilly Acquisition Plans: Eli Lilly announced plans to acquire three companies for a total of $3.83 billion to expand its infectious disease vaccine business, indicating ongoing investment and strategic shifts in drug development, which led to a stock price increase of over 1%.
- Qnity Stock Potential: Qnity shares rose more than 3%, with Jim suggesting that if coverage expands beyond a limited number of analysts, the stock could reach $250, highlighting the growing demand for materials used in advanced computer chips.
See More
Ferrari's First Electric Car Launch Draws Criticism
- Electric Car Launch Reaction: Ferrari's unveiling of the Luce, its first fully electric vehicle, resulted in a 6.03% drop in stock price on the Borsa Italiana, indicating negative market sentiment towards its minimalist design, which could impact brand perception and future sales.
- Pricing and Performance: Priced at €550,000, the Luce features four electric motors and a range of 530 km; although management claims it will be profitable from launch, the high price point may limit market acceptance and sales volume.
- Target Customer Shift: Approximately 50% of attendees at the launch event were first-time buyers, compared to the typical 10% to 20%, indicating a strategic shift by Ferrari to attract new customers, which could affect its long-term customer base and loyalty.
- Electric Vehicle Target Reduction: Ferrari has lowered its target for electric models to 20% of its lineup by 2030 from a previous goal of 40%, reflecting concerns over weak luxury demand, which may diminish its competitiveness in the electric vehicle market.
See More
Autozone Faces International Sales Challenges, Stock Drops
- Autozone Sales Decline: Despite strong domestic sales, Autozone CEO Phil Daniele indicated that international sales faced challenges in the latest quarter, resulting in a stock drop of over 5%.
- Financial Performance: Autozone reported third-quarter revenue of $4.84 billion, falling short of the FactSet consensus estimate of $4.86 billion, although earnings per share of $38.07 exceeded expectations of $36.22, indicating relative profitability strength.
- Eli Lilly Acquisition Expansion: Eli Lilly's stock rose 1% after announcing the acquisition of Curevo Inc., LimmaTech Biologics AG, and Vaccine Company to enhance its infectious diseases portfolio, demonstrating the company's intent to expand in the biopharmaceutical sector.
- Lear Corp Rating Upgrade: Lear Corp's stock gained 2% after TD Cowen upgraded its rating from hold to buy, citing the company's strong positioning in North American auto production, with expectations for a stronger market ahead.
See More
Ferrari's New EV Luce Sparks Controversy
- Design Transformation: Ferrari's Luce EV, developed in collaboration with former Apple designer Jony Ive, features a five-seat, four-door layout, marking a significant shift in the brand's electrification strategy, although this has raised concerns about the brand's traditional sports car identity.
- Declining Deliveries: The company reported a 4.4% year-on-year decline in first-quarter deliveries to 3,436 units, yet maintained a strong EBITDA margin above 39%, indicating ongoing demand for personalized vehicle features.
- Cautious Market Reaction: Following the Luce's unveiling, Ferrari's stock dropped 3% on Monday as investors expressed concerns over the brand's aggressive shift towards electrification, fearing it may compromise the brand's exclusivity and racing heritage.
- Potential Cost Pressures: Investors are worried that new U.S. tariffs on European car imports could increase costs for Ferrari in North America, potentially forcing the company to raise car prices or absorb additional costs, which could negatively impact profit margins.
See More
Midday Trading Highlights in US Stocks
- Micron Technology Surge: Micron's shares soared nearly 18%, elevating its market cap to $1 trillion, as UBS raised its price target from $535 to $1,625, indicating a potential doubling of share value, reflecting strong market confidence in the semiconductor sector.
- Semiconductor Sector Rally: The VanEck Semiconductor ETF (SMH) rose over 3%, reaching a new 52-week high, with On Semiconductor and Western Digital both gaining nearly 9%, showcasing investor optimism regarding the recovery of the chip industry.
- Oklo Nuclear Tech Progress: Oklo's stock increased by 6% after being selected by the Department of Energy for discussions on using Cold War-era plutonium as fuel, indicating the company's strategic collaboration potential in the nuclear energy sector.
- Modine Manufacturing Agreement: Modine's shares jumped 16% after announcing a $4 billion agreement with a strategic data center customer, expected to significantly enhance revenue and market position through 2029.
See More
Ferrari's New EV Launch Triggers Stock Decline
- Stock Reaction: Ferrari's shares fell as much as 6% on Nasdaq following the unveiling of its new EV, Luce, indicating negative market sentiment regarding its design, which may impact short-term sales performance.
- Analyst Insights: Evercore ISI analyst suggests that despite initial poor reactions, Luce could attract new customers, maintaining an outperform rating with a $475 price target, representing a 36% upside potential.
- Public Feedback: The design of Luce faced criticism on social media, with some users labeling it as one of the ugliest EV designs, which could deter potential buyers and exacerbate market concerns.
- Market Outlook: Although demand for luxury EVs remains low, Bernstein analysts believe that the launch of Luce could stimulate sales, projecting an expanded customer base for Ferrari, with an outperform rating and a $402 price target, suggesting a 15% upside.
See More
Key Highlights from Tuesday's Investing Club Meeting
- Market Rally: The S&P 500 rose on Tuesday, primarily driven by technology stocks like Micron, Western Digital, and Seagate, reflecting investor optimism about a potential U.S.-Iran deal to end the conflict.
- Arm Stock Trim: Following a 46% gain last week, Jim Cramer decided to trim his position in Arm, emphasizing the importance of taking profits rather than chasing parabolic moves to maintain portfolio stability.
- Eli Lilly Acquisition Plans: Eli Lilly announced plans to acquire three companies for a total of $3.83 billion to expand its infectious disease vaccine business, indicating ongoing investment and strategic shifts in drug development, which led to a stock price increase of over 1%.
- Qnity Stock Potential: Qnity shares rose more than 3%, with Jim suggesting that if coverage expands beyond a limited number of analysts, the stock could reach $250, highlighting the growing demand for materials used in advanced computer chips.
See More
Ferrari's First Electric Car Launch Draws Criticism
- Electric Car Launch Reaction: Ferrari's unveiling of the Luce, its first fully electric vehicle, resulted in a 6.03% drop in stock price on the Borsa Italiana, indicating negative market sentiment towards its minimalist design, which could impact brand perception and future sales.
- Pricing and Performance: Priced at €550,000, the Luce features four electric motors and a range of 530 km; although management claims it will be profitable from launch, the high price point may limit market acceptance and sales volume.
- Target Customer Shift: Approximately 50% of attendees at the launch event were first-time buyers, compared to the typical 10% to 20%, indicating a strategic shift by Ferrari to attract new customers, which could affect its long-term customer base and loyalty.
- Electric Vehicle Target Reduction: Ferrari has lowered its target for electric models to 20% of its lineup by 2030 from a previous goal of 40%, reflecting concerns over weak luxury demand, which may diminish its competitiveness in the electric vehicle market.
See More
Autozone Faces International Sales Challenges, Stock Drops
- Autozone Sales Decline: Despite strong domestic sales, Autozone CEO Phil Daniele indicated that international sales faced challenges in the latest quarter, resulting in a stock drop of over 5%.
- Financial Performance: Autozone reported third-quarter revenue of $4.84 billion, falling short of the FactSet consensus estimate of $4.86 billion, although earnings per share of $38.07 exceeded expectations of $36.22, indicating relative profitability strength.
- Eli Lilly Acquisition Expansion: Eli Lilly's stock rose 1% after announcing the acquisition of Curevo Inc., LimmaTech Biologics AG, and Vaccine Company to enhance its infectious diseases portfolio, demonstrating the company's intent to expand in the biopharmaceutical sector.
- Lear Corp Rating Upgrade: Lear Corp's stock gained 2% after TD Cowen upgraded its rating from hold to buy, citing the company's strong positioning in North American auto production, with expectations for a stronger market ahead.
See More
