Ferrari shares jump on positive pre-close analyst call

Ferrari shares climbed over 4% after a pre-close analyst call where management reiterated expectations for a stronger H1 2025, primarily due to the declining Daytona SP3 deliveries, which new model ramps like the SF90XX and 12Cilindri are set to offset. Q2 margins are guided to be broadly in line with Q1, and while the full-year EBITDA target of over €2.68 billion was maintained, analysts note a conservative H2 baseline suggesting potential for a future guidance raise. Free cash flow is expected to decline quarter-on-quarter to €226 million. A key catalyst is the October 9 investor event, anticipated to reveal updates on Ferrari's EV strategy, potentially shifting towards greater ICE exposure, and a new 3-5 year outlook focusing on price and mix improvements over volume growth.

Analysis

Ferrari's shares responded positively, climbing over 4% in Milan, to management's pre-close analyst call which reaffirmed a stronger first half of 2025 relative to the second half. This outlook is primarily shaped by product lifecycle dynamics, with the contribution from the high-margin Daytona SP3 declining as its final 100 units are delivered in Q2 and Q3, while the ramp-up of new models like the SF90XX and 12Cilindri is expected to partially offset this. Management guided for Q2 margins to be consistent with Q1 levels and maintained its full-year EBITDA target of above €2.68 billion. However, analysts note this guidance implies a conservative H2 run-rate approximately 10% below H1, suggesting potential for a future upward revision. A significant quarter-on-quarter decline in free cash flow is anticipated for Q2, projected at €226 million from €623 million, driven by high F80 prepayments in Q1 and elevated tax payments. External risks appear managed, with substantial FX hedging in place and negligible tariff impacts expected. The upcoming October 9 investor event is a key catalyst, where updates to the EV strategy—potentially favoring a greater internal combustion engine mix by 2030—and a new 3-5 year plan focused on price and mix over volume are anticipated.

Key Decisions for Investors

• Given the consistent messaging and conservative full-year guidance which analysts believe could be raised, investors may find the current outlook supportive of existing long positions.
• The October 9 investor event is a critical catalyst; investors should closely monitor for shifts in the long-term EV strategy and the new multi-year outlook, as these will likely drive the next phase of the stock's valuation.
• Monitor the upcoming Q2 results on July 31 for clarification on the significant sequential drop in free cash flow and any commentary on the rumored delay of its second battery-electric vehicle, which represent key short-term risks.
• The company's focus on price and mix improvements over volume, coupled with strong residual values, reinforces the brand's premium positioning, a factor that should be central to any long-term investment thesis.