Ferrari N.V. (RACE): what the price assumes

In the published model solve dated 2026-Q2, anchored at $424.44, Ferrari N.V. (RACE) is priced for +28.6% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-19.

Generated: 2026-08-25 · Source: https://boothcheck.com/report/RACE

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 11: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 9.2% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: n/a

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.3%); the inversion above states its own rate.

Per-Model Detail (n=17)

Solvency

Bullet Takeaways

• Ferrari earns a roughly 29.5% operating margin and covers its interest about 21.3x, the economics of a luxury house rather than a car maker, with an order book that already reaches the end of 2027.
• The price embeds operating-income growth near 25.3% a year held over a five-year stretch, a pace few fast growers sustain that long, and that persistence is the real bet a buyer takes on here.
• Two dated markers sit just ahead: second-quarter results on July 30, 2026, and first deliveries of the battery-electric Luce in the fourth quarter of 2026.

Bull Case

Start with the number that separates Ferrari from almost everything it screens against. The business runs a roughly 29.5% operating margin, the kind of profitability a volume car maker never approaches, with returns on equity in the same rarefied territory. That gap is not the residue of one good year. Ferrari sells scarcity on purpose, and it says so in plain risk-factor language: the 20-F warns that If we are unable to balance brand exclusivity with increased production, we may erode the desirability and ultimately the consumer demand or relative pricing for our cars. Read that backwards and it is a description of pricing power. The company deliberately holds volume below demand so the waiting list, and the price, stay firm.

The demand side is visible in a way most companies cannot show. Allocations run through the dealer network on the order book and each customer's waiting time, not on a sales forecast the company hopes to meet. The filing describes setting them based on various metrics including expected developments in the relevant market, the number of cars sold historically by the various dealers, current order book of dealers and the average waiting time of the end customer. As of the first quarter that order book already reached the end of 2027, which means most of two years of production is effectively pre-sold. On top of the base car, personalization and Special Series work carry richer economics: the 20-F notes these offerings typically generate higher revenues and profitability margins than our Range and Special Series models, and that Ferrari keeps lifting the average price point over time. The 29.5% margin is what that mix looks like in aggregate.

There is a second engine that has little to do with building cars. Sponsorship, commercial and brand revenue, mostly the Formula 1 team and licensing, is about 11% of the top line and carries the economics of a media business more than a factory, while Cars and spare parts make up the other 84%. For a bull, the electric Luce is the call option: reaching first customers in the fourth quarter of 2026, it extends the same scarcity model into a powertrain the whole industry is drifting toward, without conceding that combustion is finished. The company is careful on exactly that point, noting that combustion engines will continue to be fundamental to the Ferrari driver experience for the foreseeable future even as hybrids and full electrics spread across performance cars. If the growth the price assumes is going to be earned, this is the machinery that earns it: scarcity, mix, brand, and a new price tier at the very top of the range.

Bear Case

The whole case rests on time. At $377.49 the market is paying for operating-income growth of about 25.3% a year to continue over a five-year stretch. Ferrari has posted growth in that neighborhood before, so the yearly figure is plausible. What is hard is the endurance: among companies that have grown that fast, only a minority kept it going even five years. Buy the stock here and that persistence is the thing being underwritten, not this year's result.

The valuation methods make the dependency concrete. Only the cash-flow methods, which credit future growth, reach today's price. The methods that value Ferrari on its assets land around 2.25x below it; the peer multiple methods about 2x under; the methods that capitalize today's earnings with no growth land more than three times below. Strip out the growth story and a large gap opens beneath the price. That is not a defect in the methods. It is the statement that almost the entire quote is a bet on durable compounding, a premium a valuation built on today's earnings cannot manufacture.

The narrative also has to survive a technology change and a trade one. Ferrari is threading a needle: keep the combustion mystique buyers pay for while launching an electric car into a market that has never bought a battery-powered Ferrari. The company does not pretend this is free. Its own risk factors carry the blunt line that The introduction of electric technology in our cars is costly and its long-term success is uncertain, alongside the note that hybrid and full electric cars may become an increasingly prevalent technology for performance sports cars. Trade policy is the other exposure: a large share of Ferrari's cars cross into the United States, and the 20-F warns that imports into certain markets, including the United States, may, depending on their scope and implementation, adversely affect our operations. Then there is volume. Management holds production below demand by design, which protects price but caps how fast revenue can compound; shipments fell to 3,436 cars in the first quarter from 3,593 a year earlier during planned model change-overs. Net debt near $1.6 billion against interest coverage above 21.3x means solvency is not the question. The question is narrower and harder: a price built almost entirely on sustained growth is riding on mix, pricing, and an unproven electric flagship, because the scarcity discipline that defends the margin is the same discipline that limits the volume.

Valuation

At $377.49 (July 19, 2026) the price is best read backwards. What it assumes is operating-income growth of about 25.3% a year, carried over a five-year stretch, on the kind of economics Ferrari has actually shown. Management's own FY2026 targets, net revenue of €7.5 billion and adjusted operating profit of at least €2.22 billion, describe a business still growing but not at the pace the price extrapolates over the longer run. Ferrari has grown near that rate before, so the near-term figure is believable; what the price needs is for it to keep doing so year after year, and that endurance is what a buyer pays for.

How far past the evidence does that sit? Group the methods by what they measure. The ones that value Ferrari on its assets land around 2.25x below the price; the peer multiple methods about 2x below; the ones that capitalize today's earnings with no growth land more than three times below. Only the cash-flow methods, which credit forward growth, reach the price at all. That spread is the whole story: almost the entire quote is a premium for durable compounding that no method built on today's numbers can frame. The static methods are not wrong, they are pricing a different question.

The visibility behind the number is unusually good for a discretionary product, because much of it is pre-sold; the filing notes that The advances are recognized in net revenues when the cars are shipped or the services provided, and Ferrari states plainly that We also seek to increase the average price point of our Range and Special Series models over time. The balance sheet is not where the risk lives: about $1.6 billion of net debt, with operating income covering interest roughly 21.3x, bounds nothing about the story. The mix behind the price sits in Cars and spare parts at about 84% of revenue, Sponsorship, commercial and brand near 11%, and the rest in Other. The one figure that governs the whole read is not on the balance sheet. It is whether a roughly 29.5% operating margin, extraordinary for anything that builds cars, survives the years of compounding the price already counts on.

Catalysts

Two events sit directly ahead. Ferrari reports second-quarter 2026 results on July 30, 2026; the first quarter set the tone, with net revenue of €1.85 billion and shipments of 3,436 cars, down from 3,593 a year earlier as planned model change-overs moved through the range, while management reaffirmed full-year guidance. With the order book running to the end of 2027, the near-term print is less about a demand surprise than about mix and pricing.

The larger catalyst is the electric Luce, previewed under the Elettrica name and revealed in full in Rome on May 25, 2026. Priced from €550,000 with first customer deliveries due in the fourth quarter of 2026, it is Ferrari's first battery-electric car and its first five-seater, and it opens a new price tier at the top of the range. How the order book and pricing hold as that car reaches customers is the most important thing to watch over the next several quarters.

Sell-side sentiment is warm: of the analysts covering the stock, a large majority rate it a buy, with a median price target near $475. That target sits above where the methods anchored on today's earnings land, consistent with the street crediting the same durability of compounding the price already embeds.

Peer Cohorts (Per Segment, With Filing Citations)

Core business (reported)

• TSLA (Tesla, Inc.)
• FY2025 10-K: …and new competitors. The worldwide automotive market is highly competitive today and we expect it will become even more so in the future. A significant and growing number of established and new automobile manufacturers, as well as other companies, have entered, or are reported to have plans to enter, the market for…
• FY2025 10-K: …and an increase in tariffs compared to the prior year. Cost of services and other revenue increased $1.68 billion, or 17%, in the year ended December 31, 2025 as compared to the year ended December 31, 2024, primarily due to increases in used vehicle sales volume and cost, cost of paid Supercharging sessions, cost…
• LCID (Lucid Group, Inc.)
• FY2025 10-K: …employees could seriously harm our business and prospects. In addition, our employee equity program is a key factor in our ability to attract and retain talent and continue to support the growth of the company. If we are unable to grant equity awards, or if we are forced to reduce the value of equity awards to be…
• FY2025 10-K: …certain financial institutions to increase the effective conversion premium. Contemporaneously with the 2030 Notes offering, the Company repurchased $ 1,052.5 million aggregate principal amount of the 2026 Notes, using $ 931.4 million of the net proceeds of the 2030 Notes. See Note 6 "Debt" for more information. In…
• LI (Li Auto Inc.)
• FY2025 20-F: …marketing, sales, and support of their vehicles. For example, we believe that BYD has a dominant market share in the NEV market, in particular for NEVs priced under RMB200,000 (US$28,600), and Tesla holds a dominant position in the segment for NEVs priced above RMB 200,000 (US$28,600). Meanwhile, experienced entrants…
• FY2025 20-F: …currently sell vehicles in the United States. 25 Table of Contents New geographic markets may have competitive conditions, user preferences, and discretionary spending patterns that are more difficult to predict or satisfy than our existing markets. In certain markets, we have relatively little operating experience…
• NIO (NIO Inc.)
• FY2025 20-F: …globalization, and industry consolidation. Increased competition will place greater demands on, among others, product design and performance, technological innovation, pricing, product quality and safety, manufacturing efficiency, sales and marketing capabilities, service and charging options, and user satisfaction.…
• FY2025 20-F: …from sales of parts, accessories and after-sales vehicle services and provision of power solutions, as a result of continued growth in the number of our users, partially offset by (iii) the decrease in revenue from sales of used cars by RMB587.8 million. Cost of sales Our cost of sales increased by 12.7% from…
• RIVN (Rivian Automotive, Inc. / DE)
• FY2025 10-K: …fourth quarter of 2025. Competition We aspire to drive meaningful change in the world's transition to sustainable mobility. We believe the primary competitive factors in our markets are talent and culture, technological innovation, product performance and quality, customer experience, brand differentiation, product…
• FY2025 10-K: ANCIAL STATEMENTS 18. SEGMENT INFORMATION The Company defines its segments on the basis by which internally reported financial information is regularly reviewed by the chief operating decision maker ("CODM") to evaluate financial performance, make operating decisions, and allocate resources. The Company's Chief…
• GM (GENERAL MOTORS COMPANY)
• FY2025 10-K: We operate in a highly competitive industry that has historically had excess manufacturing capacity, and attempts by our competitors to sell more vehicles could have a significant negative effect on our vehicle pricing, market share, and results of operations. The global automotive industry is highly competitive in…
• FY2025 10-K: …our results of operations, financial condition, and growth prospects, and could negatively impact our brand and reputation. Our near-term profitability is dependent upon the success of our current line of vehicles, particularly our full-size ICE SUVs and full-size ICE pickup trucks. While we offer a broad portfolio…
• F (Ford Motor Co)
• FY2025 10-K: …by our China joint venture, Jiangling Motors Corporation, Ltd. ("JMC"), that are sold to dealerships or others. Vehicles sold to daily rental car companies that are subject to a guaranteed repurchase option (i.e., rental repurchase), as well as other sales of finished vehicles for which the recognition of revenue is…
• FY2025 10-K: …for EVs leading to excess supply in that market segment. The decline in value of foreign currencies can also contribute significantly to competitive pressures in many of our markets. Competitive Position. The worldwide automotive industry consists of many producers, with no single dominant producer. Certain…
• TM (TOYOTA MOTOR CORP/)
• (no filing in the citation store)

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.