HSBC Downgrades Ferrari (RACE) to Hold, Sees Slow Growth Ahead
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 13 2026
0mins
Source: seekingalpha
- Rating Downgrade: HSBC has downgraded Ferrari (RACE) from Buy to Hold, reflecting a comprehensive review of the European auto sector, where the ramp-up of the F80 and increasing share of special models are offset by rising F1 R&D expenses and foreign exchange headwinds.
- Cautious Growth Outlook: Analyst Michael Tyndall noted that Ferrari's management has made it clear that any significant margin improvement will be slow and steady, indicating a desire to temper market expectations while emphasizing the brand's exclusivity.
- Market Reaction: Ferrari's shares have declined by 12.4% over the past 52 weeks, indicating market concerns regarding its growth prospects, despite a consensus Buy rating from both Wall Street and Seeking Alpha analysts.
- Long-Term Outlook: While HSBC sees potential for positive surprises regarding long-term guidance, these catalysts are not expected to materialize in the first half of 2026, reflecting strategic adjustments under high valuation conditions.
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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.
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- 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.
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- 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.
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- Range and Design: The Luce is equipped with a 122 kWh battery that supports a range of 329 miles, and its design has sparked controversy; CEO Benedetto Vigna stated that the aim was to leapfrog traditional aesthetics to attract a new generation of consumers, even at the risk of alienating loyal fans.
- Market Reaction: Following the launch, Ferrari's stock fell by 6% in premarket trading, and the stock has already declined by 30% over the past year, indicating investor concerns regarding this high-stakes transition to electric vehicles, with competitors like Porsche and Lamborghini closely monitoring the situation.
- Pricing and Market Positioning: Priced at approximately $600,000, the Luce is Ferrari's first five-seat vehicle, and while its design has been criticized as resembling a generic EV, the company aims to leverage innovative design and technology to attract new customers and drive future brand growth.
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- Economic Data Release: Investors are keenly watching the upcoming consumer confidence data release, along with quarterly reports from AutoZone, Cargo Aircraft Management, and Elbit Systems, which are expected to significantly influence market sentiment.
See More
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- Electric Vehicle Launch: Ferrari unveiled its first fully electric model, the Luce, in Rome, which is seen as a significant milestone in the company's history; however, the market reacted negatively, with shares dropping 6.1% post-launch.
- Customer Demand Consideration: CEO Benedetto Vigna stated that the design of the Luce will respect new technology while catering to both existing and new customers, even as other luxury brands scale back EV plans due to weak demand.
- Poor Market Performance: Ferrari's stock has fallen nearly 27% over the past year, and the launch did not boost market confidence, reflecting investor concerns about the luxury electric vehicle market's prospects.
- Brand Strategic Shift: Vigna emphasized that the launch of the Luce symbolizes a transformation for the Ferrari brand, and despite challenges, the company aims to attract a broader customer base through new technology.
See More
