RACE Should I Buy
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Ferrari NV (RACE) is not a strong buy at the moment for a beginner investor with a long-term strategy. While the company has strong brand value and positive long-term growth prospects, the current technical indicators, recent price decline, and lack of immediate positive catalysts suggest waiting for a more favorable entry point.
The MACD is negatively expanding (-0.985), indicating bearish momentum. RSI is at 38.153, which is neutral but leaning towards oversold territory. Moving averages are converging, showing no clear trend. The current price of $349.17 is below the key pivot level of $365.7, with support at $344.697 and resistance at $352.717, suggesting limited upside in the short term.
Hedge funds have significantly increased their buying activity (+353.70% last quarter). Analysts have recently raised price targets, with JPMorgan setting a target of $447 and RBC Capital at EUR 430, reflecting long-term confidence in the stock. Ferrari's strong gross margin (51.88%) and its ability to maintain high average selling prices are positive indicators.
The stock is down -2.61% in the regular market and -3.01% in pre-market trading, reflecting bearish sentiment. The MACD and RSI suggest weak momentum, and the market as a whole is down (S&P 500 -0.8%). Ferrari's Q4 financials showed a slight decline in net income (-1.18% YoY), and its EPS growth was stagnant (0.00% YoY). Additionally, the company's reduced EV sales target may limit growth in the EV segment.
In Q4 2025, Ferrari's revenue increased by 3.79% YoY to $1.8 billion, and gross margin improved to 51.88% (+3.35% YoY). However, net income dropped slightly by -1.18% YoY to $379.7 million, and EPS remained flat at 2.14. While the company is showing resilience, growth is modest, and near-term earnings management remains a concern.
Analyst sentiment is mixed but generally positive. JPMorgan raised its price target to $447 with an Overweight rating, and RBC Capital set a target of EUR 430 with an Outperform rating. However, there are concerns about near-term growth, as reflected in BofA's lowered target to EUR 360 and UBS's cautious delivery strategy for early 2026.
