Lucid files for 1-for-10 reverse stock split requiring shareholder approval
On Monday, Citi reiterated its Sell rating on Ferrari NV (NYSE:RACE:IM) (NYSE: RACE), with a steady price target of EUR360.00. The decision comes amidst concerns over potential tariff impacts on the luxury car manufacturer, which could affect its significant U.S. market presence. Ferrari (BIT:RACE), known for its high-end vehicles and strong brand, sells approximately 4,000 cars in the U.S. annually, translating to around €2.2 billion per year and accounting for 35%-40% of its EBIT, with all production based in Italy.
Citi’s analysis acknowledges Ferrari’s ability to better manage tariff-induced price increases compared to its German counterparts, but also notes the potential for reduced sales volumes as a consequence. This observation aligns with recent remarks from the Lamborghini CEO, suggesting that even with strong pricing power, volume risks cannot be ignored.
The firm’s commentary further highlights the disparity between Ferrari’s valuation and that of German OEMs, pointing out that Ferrari trades at a price-to-earnings ratio approximately 50 times higher. This valuation comes into question particularly in light of Ferrari’s weaker-than-expected EPS growth forecast for FY25.
Citi’s stance remains cautious, emphasizing the potential for lower EPS growth in FY25, coupled with Ferrari’s high valuations and a possibility of declining momentum flows. These factors collectively pose a short-term risk to the stock, according to Citi, leading to the confirmation of the Sell rating.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.