What did traders not like?

The afternoon at the Italian Stock Exchange has been busy since collapse of Ferrari shares. The Maranello Rose slipped to 371 euros after remaining above 400 euros all morning. With about an hour left until the session closes, the stock loses 2.4 percent to 388 euros.

As you can see from the real time graph below, there is a precise moment in which Ferrari shares changed course, going from green to red: the dissemination of quarterly accounts. Once again, therefore, the publication of a quarterly is a watershed for the stock market performance of the stock concerned. In the case of the Ferrari quarterly everything is even more singular because, in reality, the first quarter of 2024 for the Ferrari went very well with revenues and profitability recording a very robust improvement. And then the question is almost obligatory: Why are Ferrari shares plummeting despite a very strong quarterly result? What do traders not like about Ferrari’s quarterly accounts (assuming there is something that went wrong?)?

To answer these questions it is essential to examine the listed company’s quarterly results in detail.

Ferrari quarterly in detail

As previously mentioned, Ferrari’s first quarter of 2024 was characterized by an increase in revenues and profitability. In detail i revenues they amounted to 1.59 billion euros with a progression of 10.9 percent compared to the 1.43 billion achieved in the first three months of the previous financial year. Overall, from January to March, Rossa delivered 3,560 cars, 7 cars less than in the first quarter of 2023.

Going down to the income statement, the adjusted gross operating margin marked a progression of 13 percent to 605 million euros, generating a consequent improvement in marginality which rose to 38.2 percent. As late as the end of the first quarter of 2024 adjusted operating result of Ferrari rose to 442 million euros with a progression of 15 percent year on year and a margin on revenues equal to 27.9 percent which compares with 26.9 percent in the first quarter of 2023. The last indicator is the most significant: theNet income of the first three months of the financial year amounted to 352 million euros with an increase of 19 percent compared to 297 million euros a year ago.

As regards the liquidity position, at the end of March 2024 the net industrial financial position of Ferrari was positive for 38 million euros compared to a debt of 99 million euros at the beginning of the year.

In short, from revenues to profitability, from net profit to net debt, Ferrari’s quarterly report is a long sequence of positive notes. This only reinforces the doubts about the reasons behind the collapse of the stock but following the quarterly accounts.

Ferrari confirms the outlook for 2024: prices +43% year on year

In Ferrari’s quarterly report there is a reference to estimates for the entire financial year. In this case, however, there are no surprises because the Rossa management simply confirmed the estimates already known. From this perspective, Ferrari aims to close 2024 with revenues equal to over 6.4 billion euros, a adjusted gross operating margin of at least 2.45 billion euros and consequently one marginality which could be even higher than 38 percent. Still the adjusted operating result at the end of the year it should be more than 1.77 billion euros and theadjusted net profit per share should settle at over 7.5 euros.

These are estimates that were already known. Precisely the fact that despite the excellent quarterly report the management preferred to remain cautious about the 2024 financial year, may have pushed investors to take a pause for reflection. Moreover, the price of Ferrari shares grew by 43 percent in the last year alone. We are therefore talking about a listed company that is so popular that profit-taking is almost natural and physiological. Even if we narrow the field only to the trend since the beginning of the year, the result does not change with a progression of over 24 percent.

We remind you that to buy Ferrari shares there are two ways: the actual purchase of the stock or speculation with derivative instruments such as CFDs. In the first case you become shareholders while in the second there is no ownership of the underlying and therefore you can do both long and short trading. Platforms that allow you to operate in both ways are:

• eToro: broker to buy real Ferrari shares and always from the same platform upward and downward trading through stock CFDs they operate by lever. eToro offers copy trading with which to copy the strategies of the best traders.

• Fineco: allows you to buy real shares but also to trade with CFDs and super CFDs. Among the recent innovations is the launch of the new trading-only account without fixed costs. Fineco is considered the bank with the best trading platform in Italy.

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