It was a pretty big win for sports car king Ferrari (NYSE:RACE) as Barclays took another look at the stock and liked what it saw therein. This sent shares up fractionally in Monday afternoon’s trading session. The news isn’t all positive, but there’s quite a bit here to like.
Barclays, via analyst Henning Cosman, noted that Ferrari just turned in what it called a “very strong” earnings report for its third quarter. Further, all the insight that management could offer around pricing and the marketing mix, as well as its current book of orders, were all quite positive.
That’s proven quite helpful, and when you throw in the fact that Ferrari’s target market has always been the “ultra high net worth” segment of buyers, it’s relatively protected from any macro issues. People who have the money to buy a Ferrari are probably going to buy one regardless of whether or not the price of eggs goes up another quarter.
Ferrari didn’t have it all its own way, however; a recent accident at a Formula One event was pinned on a malfunction in a Ferrari engine. Charles Leclerc’s accident seems to trace back to an engine issue and a “hydraulic failure” that caused his rear wheels to lock up and a subsequent spin to follow. That’s not a good look for Ferrari, especially given that the Formula One circuit is so representative of the brand.
However, on a more positive note, Ferrari’s work on its first electric vehicle is still on track to hit markets starting in 2025. In fact, some processes are currently “ahead of schedule,” noted CEO Benedetto Vigna, but overall, it should be out as previously scheduled.
Is Ferrari a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on RACE stock based on eight Buys, six Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average RACE price target of $348.14 per share implies 4.92% upside potential.