Ferrari Stock Is Down 33% Since July 2025: 1 Reason the Market Is Wrong.
Key Points
Investors should appreciate this company’s steady financial performance, supported by pricing power and strong demand.
Ferrari shares have taken a beating since last summer, driving the valuation to an attractive level.
- 10 stocks we like better than Ferrari ›
Since the stock reached an all-time high last July, Ferrari (NYSE: RACE) investors have bid the shares down 33% (as of June 5). During a capital markets presentation in October, the business forecasted slower-than-expected growth through 2030. Furthermore, investors don't seem upbeat about Ferrari's recent introduction, its first fully electric vehicle called the Luce.
Here's why the market is wrong about this supercar manufacturer.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: The Motley Fool.
The market is being short-sighted here. This is an outstanding company, whose revenue and diluted earnings per share have risen 83% and 110%, respectively, between the first quarter of 2021 and Q1 2026. While the pace of growth might slow, this overarching trend should continue over the long term.
The growth isn't eye-popping. But it's the consistency and predictability that are notable.
Plus, the Ferrari brand, the single-most important asset that supports the company's wide economic moat, is still robust. The business possesses incredible pricing power, driven by low-volume runs driving strong demand, leading to a trailing-five-year average quarterly operating margin of 27.2%.
The luxury automotive stock trades at a price-to-earnings ratio of 33.4. This valuation is at an 18% discount to the stock's historical average. And the multiple has contracted 34% in the past 12 months.
For investors who have been waiting patiently on the sidelines, it's time to get in the driver's seat. Ferrari is a smart buy.
Should you buy stock in Ferrari right now?
Before you buy stock in Ferrari, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Ferrari wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $443,191!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,258,838!*
Now, it’s worth noting Stock Advisor’s total average return is 941% — a market-crushing outperformance compared to 206% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of June 8, 2026.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ferrari. The Motley Fool has a disclosure policy.
Recommended Articles
