Italian sports car manufacturer Ferrari has reassured investors about its anticipated growth, unveiling optimistic forecasts during the presentation of its 2023 results.
The company’s shares surged by as much as 9.5%, propelling its market value towards a potential record-breaking $100 billion.
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Ferrari’s chief executive, Benedetto Vigna, expressed confidence in the brand’s trajectory, citing a robust order book extending through 2025. Vigna affirmed, “The vitality of our business is once again confirmed by the order book… which remains strong across all geographies and covers the entire 2025.”
The Italian automaker, known for its luxury sports cars, is set to embark on a new chapter in the final quarter of the next year with the launch of its inaugural fully electric car. The company’s 2023 results, aligning with its targets, forecast adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) to rise to a minimum of 2.45 billion euros ($2.64 billion) this year, surpassing the 2.28 billion euros achieved in 2023.
Contrary to investor fears of conservative guidance below consensus estimates, the positive forecasts led to a substantial upswing in Ferrari’s shares. RBC analysts noted that the market had anticipated a more conservative outlook, contributing to a recent sell-off. On news of the results, Ferrari shares soared by 9.2%, recovering from a decline of over 10% between mid-December and late January.
Meanwhile, beyond financial discussions, media reports surfaced suggesting that Ferrari’s Formula One racing team secured a significant win by signing seven-time world champion Lewis Hamilton to race for them starting in 2025.
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By GlobalDataFerrari reported a 3% increase in shipments last year, reaching 13,663 vehicles. The growth was propelled by the ramp-up phase of its Purosangue model, a four-door, four-seater addition to its lineup.
The automaker generated over 930 million euros in cash in the past year, with approximately 800 million set to be distributed to shareholders through dividends and share buybacks, according to CEO Vigna.
Analysts from Bernstein acknowledged Ferrari’s recent adjustments to earnings expectations and noted that the guidance for this year could bring relief to investors who had concerns about managing down expectations in 2024.
With a focus on personalisation, which constituted around 19% of Ferrari’s total revenue last year, Vigna highlighted the “exceptional visibility” provided by the company’s order book, enabling them to approach the high-end of their 2026 targets with increased confidence. Ferrari’s long-term business plan projects adjusted EBITDA of 2.5 billion to 2.7 billion euros in 2026.
