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Ferrari presented rather mixed Q4 results. It has negatively affected the price of RACE stock though it recently hit a 52-week high. Will the introduction of the first SUV boost the stock in 2021-2022?
The Italian maker of luxury and sports cars Ferrari SpA announced that its diluted earnings per share in the last quarter of 2019 amounted to €0.90, which is over 10% lower on an annual basis, while shipments slid 1% to 2,376 in the same period.
Net revenues grew 10% to total €927 million as EBITDA jumped 22% in the fourth quarter. The financial results showed a 13% annual decrease in quarterly net profit, at €166 million.
In the whole of 2019, shipments added 10% to reach 10,131 and net revenues climbed 10% to $3.76 billion. Diluted EPS lost 10% and annual net profit fell 11% compared with 2018.
The growth reflects the combined impact of the higher volumes, the positive contribution from the Ferrari Monza in Q4 and all personalization programs. Personalizations represented approximately 20% of this revenue line as in 2019 they were supported by a significant concentration of shipments of 488 Pista and Pista Spider.
Europe and Middle East Most Successful
The automaker had the most success in Europe and the Middle East, shipping 29% more units in the fourth quarter while tanking 65% in the Chinese market to only 60 vehicles delivered. It also disappointed in the Americas, where shipments fell 25%.
Louis C. Camilleri, Chief Executive Officer said:
“While we view 2019 as very much a transition year, 2020 will be a year of consolidation. I say this for several reasons. While we unveiled five key models during the course of 2019, actual in-market deliveries for most of those models will occur over the second to third quarter as we ramp up production, while Roma deliveries are slated to reach clients only in the fourth quarter.”
Already in 2018, Ferrari announced its plans to create its first SUV that will be called Purosangue. At this point, there is nothing extremely strange, right? Many companies, including Aston Martin and others, want to become more environmentally-friendly and compete with Tesla.
But there is another weird thing about all this. It is reported that now a small Italian sports charity, the Purosangue Foundation, and Ferrari are engaged in a legal battle for overuse of the word. Ferrari says the charity hasn’t made “sufficient commercial use of the name to warrant exclusivity.”
From the charity they said:
“We registered the word as a trademark for clothing and other products in 2013, and had sought talks with the carmaker, but blocked Ferrari’s registration to trademark the brand in Europe when no agreement could be reached.”
Alessandro Masetti, a lawyer who is representing Purosangue pro-bono said:
“This is David versus Goliath. The brand has been in constant use including in a partnership to produce branded sneakers and clothes with Adidas, a sponsor of the charity.”
Be it as it may, as we have already mentioned, Ferrari is not the only brand that suddenly decided to make SUVs. Aston Martin has also recently announced its newest product, dubbed the DBX, the company’s very first SUV. The company has said that since a significant percentage of its customer base has been men, the DBX is designed for women.
This might be a good thing for a British carmaker since last year wasn’t really representative. Being the only British carmaker to ever go through an IPO, 2019 has been the one that the carmaker has been hit with one loss after the other. Out of the top 350 firms in the United Kingdom, Aston Martin Lagonda Global Holdings Plc has been the worst-performing so far.
Ferrari (RACE) Stock
As the plans to create an SUV may soon become a reality, there are good chances for RACE stock to increase in 2021-2022. But what can we say about its recent performance? On Monday Ferrari stock hit its 52-week high of $176.58. However, the positive tendency hasn’t managed to continue after the company reported its Q4 results which turned out to be rather mixed.
At the current moment, Ferrari stock price is around $167. Will it manage to get closer to Tesla (TSLA) stock one day? Let’s wait and see. However, in 2020 Tesla seems to be unstoppable.