Why I just bought Ferrari (the stock, not the car)

📌 Key Takeaways

1. Ferrari stock recently dropped after delaying its first EV to 2027, but the fundamentals remain extremely strong.

2. According to Forecaster, the company is currently undervalued by about 7%, a rare event in recent years.

3. 80% of Ferrari buyers are repeat customers, proving strong brand loyalty and the company’s position as a luxury icon.

As many of you already know from last article, I recently made some changes in my portfolio. While I sold several positions in anticipation of broader market weakness, I also took the opportunity to increase my exposure to one company that I believe remains an exceptional long-term investment: Ferrari.

Yes, I’m Italian, and maybe I’m biased, but this is not just about national pride. Ferrari is one of the best-performing Italian companies, listed on the New York Stock Exchange (NYSE), and it just experienced a rare market correction that caught my attention.

Why the Stock Dropped – and Why It Doesn’t Matter

Recently, Ferrari stock fell significantly on high trading volume. Typically, a drop accompanied by high volume can be a bullish sign. It means that many investors were willing to buy during the dip, potentially marking a bottom.

The cause? Ferrari announced a delay in its first fully electric vehicle, shifting the launch from 2026 to 2027. Ironically, this mirrors a market reaction from two years ago, when the stock dropped simply because Ferrari said it would eventually make an EV. The lesson here? The market is rarely satisfied, especially when it comes to iconic legacy brands adapting to new trends.

However, this short-term reaction seems to ignore the bigger picture: Ferrari continues to deliver excellent results and remains fundamentally solid.

A Rare Moment of Undervaluation

I’ve followed Ferrari closely since its listing, and I can honestly say I’ve only seen it undervalued a handful of times. Two years ago in 2022, and now again in 2025.

Using Forecaster, our proprietary financial analysis software, which calculates fair value using four different methods, the current undervaluation is around 7%. This might not sound huge, but for a company like Ferrari, which usually trades at a premium, it’s significant.

Companies of this caliber rarely trade below fair value. It’s like finding Nvidia or Palantir undervalued, a rare but powerful opportunity for long-term investors.

Why Fundamentals Still Matter

Let’s go beyond the price action and talk fundamentals.

One particularly impressive insight comes from the quarterly earnings transcripts, which we summarize and analyze using AI within Forecaster. In the previous quarter, Ferrari stated that around 80% of its cars are sold to existing customers. That’s an astonishing number.

Think about it: Ferrari isn’t just selling cars, it’s selling dreams to a very wealthy, very loyal customer base. These are not ordinary vehicles; they are luxury items, status symbols, and collector’s treasures. That customer loyalty is what gives Ferrari its pricing power, brand moat, and long-term resilience.

Additionally, the company has confirmed its guidance through 2025, providing even more confidence in the business trajectory.

A Long-Term Gem in the Portfolio

In my view, Ferrari is the kind of company you want to own forever. It has:

• High margins and strong brand recognition

• Loyal, repeat customers

• Limited production, which maintains exclusivity

• Resilience during economic cycles

• Excellent management and forward guidance

That’s why, while I’ve been trimming exposure in other parts of my portfolio due to expected market weakness, I’ve doubled down on Ferrari. I truly believe it is a rare gem that belongs in any serious long-term portfolio.

A word about Forecaster

Lastly, we are constantly improving Forecaster, our financial software that helps identify these kinds of opportunities. Just last week, we rolled out a new method for fair value estimation, specifically tailored for high-growth companies. It’s another step forward in our mission to deliver the most powerful financial analysis tool available to retail investors.

And stay tuned, this week I’ll share something very important that we’ve been working on.