Ferrari Stock Soars on Strong Q4 Results and Raised Guidance

Ferrari's (RACE) stock surged following the release of its impressive fourth-quarter results and raised guidance for 2025.

Key Financial Highlights:

* Global sales rose 14% year-over-year to €1.74 billion (~$1.8 billion), exceeding estimates of €1.64 billion.
* Diluted earnings per share (EPS) reached €2.14 (~$2.22), topping estimates of €1.88.
* EBITDA (earnings before interest, taxes, depreciation, and amortization) increased 15% to €643 million (~$666.5 million), surpassing expectations by €20 million.

Strong Results Driven by Product Mix and Demand

Ferrari CEO Benedetto Vigna attributed the exceptional financial performance to "quality of revenues over volumes" due to a robust product mix and increased demand for personalization. The company expects continued growth in 2025, enabling it to achieve its profitability targets one year ahead of schedule.

EV Unveiling and Guidance Hikes

During the earnings call, Vigna announced the unveiling of Ferrari's first EV at its Capital Markets day on October 9th. The company also raised its 2025 guidance, projecting net revenues of over €7 billion (~$7.2 billion) and EBITDA of more than €2.68 billion (~$2.78 billion).

EBITDA Margin Envy and Strong Sales

Ferrari's exceptional results have resulted in an EBITDA margin of 38.3%, positioning the automaker as an industry leader with margins that typically hover in the single digits. Despite selling only 13,752 units, Ferrari generated sales of €13.75 billion (~$14.25 billion) for the quarter, translating to an impressive €111,000 (~$115,000) profit per car sold.

Headwinds Overcome by Demand

Ferrari's strong performance in the US and Europe offset weakness in China. While tariffs on EU goods could pose a challenge for other automakers, Ferrari's high-end vehicles priced around $500,000 may not significantly deter buyers.

Analyst Commentary

Morgan Stanley analyst Adam Jonas maintained an "overweight" rating for Ferrari, citing its unique defensive positioning, high single-digit top-line growth potential, and double-digit profit growth with low earnings volatility.

Other Notable Points:

* Purosangue SUV, Roma Spider, and 296 GTS sportscars drove sales growth.
* Shipments of SF90 XX and 12Cilindri commenced in the second half of the year.
* The F80 hypercar debuted with all 799 units pre-sold despite its high price.