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UBS Analyst Sees Ferrari's Earnings Report As 'Thesis Stress Test'

RACE | July 29, 2016

Ferrari N.V. (NYSE: RACE) is expected to release Q2 earnings on August 2 with earnings-per-share estimates of $0.45 and revenue of $767.22 million.

UBS's Take

UBS's Michael Binetti commented on Ferrari's positive outlook, previewing earnings. After positive analysis, Binetti reiterated the automotive company's Buy rating and $50.00 price target.

Can Ferrari Defy Market Conditions Again?

Binetti believed Ferrari's future earnings reports would act as a "thesis stress test" for Ferari. "RACE's car shipments declined by less than 5 percent vs luxury auto peers' shipments down over 30 percent in the same period… and the model is about to be tested [again]," said the UBS analyst.

The analyst was seeing "sluggish spending" in global luxury categories; however, Binetti's recent conversations with Ferrari management instilled confidence in the company's ability to continue its "strong" new car innovation initiatives and positive margin drivers' growth.

"RACE deserves to trade in line with global luxury peers due to high visibility into revs & cash flows as most products are pre-sold to wealthy consumers via long waitlists," stated Binetti.

According to TipRanks, Michael Binetti is one of the better analyst's covering Ferrari with a 56 percent success rate and a +6.4 percent average return per recommendation. The analyst is ranked 572 out of 4087 analysts.

At time of writing, Ferrari traded at $44.78, up 1.34 percent Friday.

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