Company Overview
Ferrari N.V. engages globally in the design, engineering, production, and sale of luxury performance sports cars, offering a diverse portfolio that includes sports, track, one-off, and road cars alongside supercars, spare parts, engines, and after-sales services. The company operates within the Consumer Cyclical sector, specifically in the Auto Manufacturers industry, positioning it as a provider of high-end automotive goods sensitive to discretionary consumer spending patterns. This entity maintains a substantial scale with a market capitalization of $56.52B and generates annual revenue of $7.15B, employing a workforce of 5718 individuals. These valuation and revenue figures indicate that Ferrari N.V. commands a premium market position, reflecting its unique brand equity and the limited supply nature of its luxury vehicle production relative to mass-market automotive peers.
Financial Health
The company reported a revenue of $7.15B for the trailing twelve months, with net income reaching $1.60B and EBITDA standing at $2.41B, revealing a cost structure where operating expenses and taxes consume approximately 77.7% of total revenue before reaching the bottom line. Free cash flow amounts to $839.14M, which signifies significant financial flexibility allowing the firm to fund operations, service debt, and potentially invest in new models or acquisitions without immediate external financing. The company demonstrates robust profitability across three key metrics: a gross margin of 51.7%, an operating margin of 28.6%, and a profit margin of 22.3%, indicating that the business retains over half of its production value as gross profit and maintains a highly efficient operational conversion rate. Regarding liquidity and leverage, the balance sheet shows $1.42B in cash against $2.88B in debt, resulting in a debt-to-equity ratio of 73.68% which suggests a moderately leveraged position typical for capital-intensive manufacturing but manageable given the cash generation. Short-term liquidity is supported by a current ratio of 2.30, indicating that current assets are more than double current liabilities and providing a comfortable buffer against immediate obligations. Furthermore, the return on equity is 42.9% while the return on assets is 13.8%, metrics that reveal highly effective management in utilizing shareholder capital and assets to generate superior returns compared to industry averages.
Valuation Assessment
Valuation metrics for Ferrari N.V. show a trailing P/E ratio of 30.67 and a forward P/E of 25.63, implying that the market expects earnings growth that will narrow the multiple over the coming year. The price-to-book ratio stands at 12.48, indicating that the market values the company at a significant premium of roughly 1,148% over its net asset book value, reflecting the intangible value of the brand and intellectual property. Alternative valuation measures include a price-to-sales ratio of 7.91 and an EV/EBITDA of 23.99, which suggest that investors are willing to pay a high multiple for sales and earnings relative to the capital structure. Regarding trading range, the stock has a 52-week high of $519.10 and a 52-week low of $312.51, meaning the current price sits somewhere within this historical band, bounded by these extremes. The beta value is 0.55, which indicates that the stock price exhibits lower volatility than the broader market, moving at roughly 45% less intensity during market fluctuations.
Growth & Income
Revenue growth for the trailing twelve months is 3.8%, while earnings growth is -0.2%, implying that earnings are currently declining slightly despite revenue expansion, which often points to cost pressures or one-time expenses affecting the bottom line. As a dividend payer, the company offers a dividend yield of 1.4% with a payout ratio of 33.3%, a level that is generally considered sustainable as it covers less than half of the net income, leaving ample room for retention. The low payout ratio combined with the current earnings contraction suggests the company may be prioritizing balance sheet strength or strategic investment over maximizing dividend payments at this specific moment. The overall growth and income profile presents a mature luxury asset with steady revenue expansion, modest dividend income, and a temporary dip in earnings growth that investors must weigh against the brand's long-term pricing power and market position.