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Despite the gloomy economic outlook, no recession seems to exist for the luxury automaker as its superior products are in high demand, as quarterly car sales reached an all-time high of 3567.
Customers trying to get a new Ferrari must be patient as the waiting list
extends into 2025. The testament to the above statements is the newly
launched Daytona SP3 model, which is limited to 599 units. This constrained
supply, in combination with very high demand, enables Ferrari to charge a
whopping starting price of $2.3m for that particular model, which was sold
out even before its unveiling.
Unsurprisingly in Q1’2023, the company reported better-than-expected Revenue of €1,429m (vs. consensus estimates for €1,375m) and EBIT of €385m (26.9% margin) driven by its elite clientele and incredible brand loyalty.
For a growing crowd of investors, the luxury sector to the European stock market is analogues to what Big Tech has been to the US: Dominant businesses whose growth is unshakable even as the economy loses steam. Ferrari is a testimony to the trend of a brand that has always been synonymous with luxury.
As seen from the chart above, demand for high-end sports cars has held up well among Ferrari’s wealthy customers even as it increased prices. This is in stark contrast to some automakers, such as Tesla, who are losing pricing power as the economy heads for a slowdown. As a result, Ferrari shares have been outperforming Tesla recently by miles, up over 40%, while Tesla is down a staggering 33%.
A testament to Ferrari’s incredible profitability is its gross profit margins (GM) of close to 50%, head and shoulders ahead of the competition; Tesla comes second with GM of 23%. However, the latter has been slashing prices recently, negatively impacting its profitability.
Is the rally overextending?
The stock is up 37% year-to-date, trading at an all-time high of $300, and despite its incredible momentum, the number one luxury automaker could face some major corrections. The current share price already reflects a lot of positive market news, such as the unprecedently high demand and improving company fundamentals. However, the Italian luxury automaker is trading at about seven times its forward sales (and 40 times forward earnings), by far the most expensive car stock in Europe, in fact, more expensive than any other auto manufacturer, except for Tesla.
High conviction investors might short the stock using our -3x Ferrari or long Ferrari using our 3x Ferrari.
Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.
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Notice
If you are not classified as an institutional investor, you will be categorised as a private/retail investor. At this time, we cannot send communications directly to private/retail investors. You are welcome to view the contents of this website.
If you are an ‘Institutional investor’, you affirm either that you are a Per Se Professional Client, or that you wish to be treated as an Eligible Counterparty Client, both as defined under the Markets in Financial Instruments Directive, or an equivalent in a jurisdiction outside the European Economic Area.
Risk Warnings
The value of an investment in ETPs may go down as well as up and past performance is not a reliable indicator of future performance. Trading in ETPs may not be suitable for all types of investor as they carry a high degree of risk. You may lose all of your initial investment. Only speculate with money you can afford to lose. Changes in exchange rates may also cause your investment to go up or down in value. Tax laws may be subject to change. Please ensure that you fully understand the risks involved. If in any doubt, please seek independent financial advice. Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuer.
This website is provided for your general information only and does not constitute investment advice or an offer to sell or the solicitation of an offer to buy any investment.
Nothing on this website is advice on the merits of any product or investment, nothing constitutes investment, legal, tax or any other advice nor is it to be relied on in making an investment decision. Prospective investors should obtain independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in their jurisdiction.
This website complies with the regulatory requirements of the United Kingdom. There may be laws in your country of nationality or residence or in the country from which you access this website which restrict the extent to which the website may be made available to you.
United States Visitors
The information provided on this site is not directed to any United States person or any person in the United States, any state thereof, or any of its territories or possessions.
Persons accessing this website in the European Economic Area
Access to this site is restricted to Non-U.S. Persons outside the United States within the meaning of Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”). Each person accessing this site, by so doing, acknowledges that: (1) it is not a U.S. person (within the meaning of Regulation S under the Securities Act) and is located outside the U.S. (within the meaning of Regulation S under the Securities Act); and (2) any securities described herein (A) have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction and (B) may not be offered, sold, pledged or otherwise transferred except to persons outside the U.S. in accordance with Regulation S under the Securities Act pursuant to the terms of such securities. None of the funds on this website are registered under the United States Investment Advisers Act of 1940, as amended (the “Advisers Act”).
Exclusion of Liability
Certain documents made available on the website have been prepared and issued by persons other than Leverage Shares Management Company. This includes any Prospectus document. Leverage Shares Management Company is not responsible in any way for the content of any such document. Except in those cases, the information on the website has been given in good faith and every effort has been made to ensure its accuracy. Nevertheless, Leverage Shares Management Company shall not be responsible for loss occasioned as a result of reliance placed on any part of the website and it makes no guarantee as to the accuracy of any information or content on the website. The description of any ETP Security referred to in this website is a general one. The terms and conditions applicable to investors will be set out in the Prospectus, available on the website and should be read prior to making any investment.
Leverage Investment
Leverage Shares exchange-traded products (ETPs) provide leveraged exposure and are only suitable for experienced investors with knowledge of the risks and potential benefits of leveraged investment strategies.
Cookies
Leverage Shares Management Company may collect data about your computer, including, where available, your IP address, operating system and browser type, for system administration and other similar purposes (click here for more information). These are statistical data about users’ browsing actions and patterns, and they do not identify any individual user of the website. This is achieved by the use of cookies. A cookie is a small file of letters and numbers that is put on your computer if you agree to accept it. By clicking ‘I agree’ below, you are consenting to the use of cookies as described here. These cookies allow you to be distinguished from other users of the website, which helps Leverage Shares Company provide you with a better experience when you browse the website and also allows the website to be improved from time to time. Please note that you can adjust your browser settings to delete or block cookies, but you may not be able to access parts of our website without them.
This website is maintained by Leverage Shares Management Company, which is a limited liability company and is incorporated in Ireland with registered offices at 2 Grand Canal Square, Grand Canal Harbour, Dublin 2.
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