What Updates Can We Expect from Ferrari’s 2Q17 Report?



Ferrari’s 2Q17 report

So far in this series, we’ve covered analyst estimates for Ferrari’s (RACE) upcoming earnings report. Overall, the estimates suggest a positive trend in the company’s upcoming earnings, which could continue with solid profitability.

Now let’s look at some key potential updates from Ferrari’s 2Q17 earnings event.

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Will product mix be favorable?

In 2016, sales of Ferrari’s V8 supercars got a boost, while demand for its V12 supercars declined. Notably, cars equipped with the V12 engine are typically sold at a premium price and tend to yield higher profitability than cars with the V8 engine.

In 1Q17, Ferrari managed to revive the shipments of its V12 engine cars, which resulted in a favorable product mix and had a positive impact on its margins. So in order to protect its high margins, the company needs to maintain the right balance of product mix. So we should watch for any updates on Ferrari’s consistent efforts to maintain high sales of its V12 engine cars throughout 2017.

Progress on 2017 guidance

During its 4Q16 earnings release, Ferrari gave a strong vehicle shipment guidance of 8,400 units for fiscal 2017. The company also guided its net revenues to be higher than 3.3 billion euros. That’s higher than revenues of 3.1 billion euros in 2016.

With half of the year over, the company’s financial data should reflect how it’s progressing toward its guidance.

Ferrari’s new car launches also play an important role by grabbing the attention of motorsports enthusiasts. With the help of these new launches, RACE also ensures integration of the latest technology in its supercars. So any update on Ferrari’s plans to launch new vehicles could take center stage in its 2Q17 earnings highlights.

Note that Ferrari typically sells fewer vehicles per year than other major auto giants (FXD), including General Motors (GM), Ford (F), and Volkswagen (VLKAY).

Next, let’s see how Ferrari’s valuation multiples are currently trending.


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