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Globe and Mail
2 days ago
- Automotive
- Globe and Mail
Can Ferrari Maintain Pole Position After Its Q2 Performance?
Ferrari N.V. RACE has been firing on all cylinders, with second-quarter 2025 results underscoring why the prancing horse continues to outpace the broader auto sector. The luxury automaker's revenues surged 12% year over year to €1.66 billion, powered by not just higher deliveries but also strong pricing discipline. Its ability to raise prices without denting demand is a luxury few automakers — including giants like General Motors GM and Ford F — can claim. With the order book already filled well into 2026, Ferrari's growth story has unusual visibility in a volatile industry. What makes this even more compelling is the mix shift toward hybrids and high-margin special series cars. In Q2, hybrids represented 58% of shipments, sharply up from 43% a year earlier, aligning the company with tightening global emission rules while protecting profitability. The oversubscribed nature of its special series lineup further bolsters margins. These trends, combined with Ferrari's deliberate scarcity model, make its financial engine hum at a pace few rivals can match — a sharp contrast to the volume-driven struggles facing GM and Ford. Investors are also paying attention to Ferrari's consistent earnings beat. Over the past four quarters, it has topped consensus estimates every time, delivering an average surprise of 9.2%. Image Source: Zacks Investment Research In its latest report, EPS came in at $2.70, ahead of the $2.57 consensus. Forward estimates are moving higher, with 2025 EPS forecasts jumping from $9.60 to $10.41 in just 60 days. The same upward momentum is seen for 2026, with projections climbing from $10.81 to $11.74. Let's take this performance lap by lap. Ferrari's Pricing Power Ferrari's ability to combine volume growth with price increases is the cornerstone of its financial performance. Unlike GM and Ford, which are contending with softer sales projections for 2025 and beyond, Ferrari is proving that exclusivity and brand loyalty are defensive assets. In 2024, around 81% of new cars were sold to existing customers, with nearly half owning multiple Ferraris. This loyalty allows management to adjust pricing without sacrificing demand. A Profitable Hybrid Shift The company's hybrid penetration, apart from being part of regulatory compliance, is also a profitability driver. Hybrids command premium pricing and fit seamlessly into Ferrari's brand narrative of performance meets innovation. The blend of hybrid and special series offerings is lifting EBITDA margins, which hit an impressive 38.3% in Q2 — one of the highest in the luxury automotive sector. Ferrari's free cash flow of €220 million in the quarter, coupled with net industrial cash of €1.3 billion, ensures that it can keep investing in new models while rewarding shareholders. Ferrari's Personalization as a Revenue Multiplier Ferrari's personalization program remains a high-margin growth lever, accounting for roughly 20% of total revenues. Customers routinely spend 20-25% above the base car price for bespoke features, from unique paint schemes to 'One-Off' builds. This not only boosts average revenue per unit but also strengthens brand stickiness. Management expects personalization to remain a key driver through 2026, supporting EBITDA margins. GM and Ford have customization options, but the scale and profitability of Ferrari's program are in a different league. Scarcity That Sustains Margins The company's deliberate low-volume production strategy — under 15,000 units annually — keeps exclusivity intact and pricing power high. The two-year order backlog gives Ferrari revenue certainty, which is rare in the auto industry, insulating it from cyclical swings. Geographic allocation of production ensures scarcity across regions, preventing oversupply and discounting. This discipline supports industry-leading margins. Diversified Income Beyond Car Sales Ferrari's brand is more than just its cars. Around 12% of quarterly revenues — or roughly €200 million — now comes from brand-related activities such as licensing, sponsorships, merchandise, museums, and theme parks — a notable increase from some 10% a year ago. This diversification gives Ferrari another competitive edge over peers like GM and Ford, whose brand monetization is far less developed. Valuation and Market Position At a forward P/E above 40X, Ferrari's valuation is undeniably steep compared to mainstream automakers. But investors are willing to pay a premium for predictable earnings growth, superior margins, and unmatched brand equity. With the stock up 5% so far this year, outperforming a nearly 9% drop in the broader auto sector, Ferrari is proving that it can command a luxury multiple. As EPS grows, that multiple could compress naturally, creating compounding potential without a valuation reset. End Note Ferrari's second-quarter performance highlights why the stock continues to earn a premium valuation. Strong revenue growth, consistent earnings beats, rising analyst estimates, and a backlog stretching into 2026 paint a picture of rare visibility and resilience. The hybrid shift, high-margin personalization, and diversified brand revenues add structural support to margins, while the scarcity model sustains pricing power. The Zacks Rank #2 (Buy) reflects this combination of positive earnings momentum and upward revisions. While the valuation demands continued flawless execution, Ferrari's track record suggests it can deliver. For investors seeking a high-growth, high-margin name with an enduring competitive moat, RACE remains investment-worthy. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. See our %%CTA_TEXT%% report – free today! 7 Best Stocks for the Next 30 Days Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ford Motor Company (F): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report Ferrari N.V. (RACE): Free Stock Analysis Report
Top Gear
25-06-2025
- Automotive
- Top Gear
This is the very first Cadillac Celestiq EV
This is the very first Cadillac Celestiq EV Rolls-Royce Spectre rival has the hit showrooms. Here's a reminder of what you get for the money Skip 6 photos in the image carousel and continue reading Turn on Javascript to see all the available pictures. 1 / 6 The very first customer example of the Cadillac Celestiq has landed, and the car's goal is simple: dethrone the Rolls-Royce Spectre as the world's finest electric luxo-barge. Prices start at $340,000 for a base-spec, which has a dual-motor, all-wheel-drive powertrain putting out 655bhp and 646lb ft. 0-60mph is cited at 3.7s, with just over 300 miles of range drawn from its 111kWh battery. Advertisement - Page continues below There's lots of supplementary tech too bundled in, including active air suspension, rear-wheel steering and body roll control, all tasked with making the Celestiq a worthy challenger. A challenger wearing a body made from carbon fibre and peppered with lots of funky traits: thin light signatures, active grille shutters, much glass and a unique silhouette that sits somewhere between a saloon, fastback and shooting brake. Heavy silhouette, mind: this thing weighs 3.1 tonnes. But the cabin is where the really very big coachbuilt Caddy earns its paper. It's like a first-class lounge, with four massage seats covered in lavish fabrics, a single piece 55in mega screen and a panoramic roof with individually dimmable areas. The price will then inflate depending on just how many boxes you tick on the options list, ranging from etchings on the 3D-printed parts, to the use of crystal glass and woven carbon fibre materials. You get the gist. Advertisement - Page continues below Reckon the Celestiq has a chance against the Spectre? Looking for more from the USA? READ THE LATEST USA NEWS Top Gear Newsletter Thank you for subscribing to our newsletter. Look out for your regular round-up of news, reviews and offers in your inbox. Get all the latest news, reviews and exclusives, direct to your inbox. Success Your Email*
Motor 1
19-05-2025
- Automotive
- Motor 1
Porsche Isn't in a Great Situation Right Now
Porsche might be in a mess of its own making. Sales for the German automaker were down globally by 8.0 percent through the first three months of the year. While sales in the United States were actually up, the foreign-made Macan and Cayenne made up nearly 68 percent of those sales here. That means tariffs could make the brand's two most important models uncompetitive as it struggles in other regions. A new report from The Wall Street Journal highlights the automaker's precarious position as it straddles the line between being a mainstream luxury automaker, an EV innovator , and a high-end sports car brand with models that can cost $250,000. It's a tough predicament, especially when most of its sales are two sub-$100,000 SUVs that share parts and platforms with other Volkswagen Group models. Photo by: Chris Rosales / Motor1 Porsche could avoid tariffs on the Macan and Cayenne by making them Stateside, but part of the brand's appeal and prestige lies in its 'Made in Germany' label, a factor that Volkswagen Group CEO Oliver Blume admitted in an interview with Automotive News 'is extremely important in the US.' So it might be hard for the brand to just shift production stateside if it wants to retain its appeal. The North American market saw sales increase 37 percent from January to March of this year thanks to Porsche's SUVs. However, sales in Germany, China, and the rest of Europe declined 34, 42, and 10 percent, respectively. Photo by: KGP Photography Sales for the electric Taycan were down a staggering 49 percent at the end of last year, which Porsche attributed to a model changeover and slower-than-planned 'ramp-up of electric mobility.' The entry-level Taycan starts at $102,550, offering 402 horsepower and a 4.5-second 0-60 time. The Hyundai Ioniq 5 N , meanwhile, has 641 horsepower, a 3.25-second 0-60 time, and a $67,675 starting price. You could spend the difference on an entire second car. Perhaps a nice, new Miata you won't drive ? Photo by: Brian Silvestro / Motor1 Photo by: Brian Silvestro / Motor1 Taycan sales are down 1 percent globally through the first quarter, which isn't good news for the upcoming Porsche 718 Cayman and Boxster , which are supposed to be fully electric . The 718 was rumored to debut sometime next year, but a recent report suggested that Porsche has paused the 718 program due to the battery supplier going bankrupt. Now, it might not arrive until 2207 or later. Production for the current-generation 718 is supposed to end later this year, potentially leaving a two-year gap between 718 generations. Photo by: Chris Perkins / Motor1 That means we could see the 911 serve as the brand's entry-level sports car—but it's expensive. The 2026 Carrera starts at $129,950 , an increase of over $7,500 compared to 2025. At the higher end is the 911 Carrera 4 GTS, at $178,850. After that, new versions of the GT3 and GT2 models will likely crack the $230,000 mark when they arrive later this year. The 2025 911 GT3 saw its price increase by $53,000 to start, for a new total of $224,495. Porsche also increased the price of the 2025 Cayenne. But, as Blume told Autonews , 'These are challenging times for Porsche, too,' and the executive is working to make the company 'even more robust' in the face of increased competition in China, political uncertainty, and a dynamic market. The Latest Porsche News: This Groundbreaking Porsche Prototype Is For Sale Now The Porsche 911 GT2 RS Might Be Back as a Hybrid Get the best news, reviews, columns, and more delivered straight to your inbox, daily. back Sign up For more information, read our Privacy Policy and Terms of Use . Sources: The Wall Street Journal , Automotive News Share this Story Facebook X LinkedIn Flipboard Reddit WhatsApp E-Mail Got a tip for us? Email: tips@ Join the conversation ( )
