In the third week of March 2018, Ferrari stock (RACE) continued to fall, settling at $118.39 with a loss of 2.9% for the week. In the previous week, Ferrari stock fell ~2.2%.
As of March 23, the stock had risen 12.9% in 1Q18 so far. The stock rose 14% and 3.9% in January and February, respectively. Let’s take a look at the stock’s key technical support and resistance levels.
Last week, Ferrari stock fell below its 50-day simple moving average of $122.80, suggesting minor price weakness. In February 2018, the stock reached an all-time high of $131.20, which should act as a key horizontal resistance level going forward.
Its 14-day RSI (relative strength index) score was moving downward from 39.8, showcasing weakness in its momentum. No major support level lies above $118.50.
In 2017, Ferrari stock ended its second year in a row in positive territory. The stock returned an outstanding 80.3% last year after rising 21.1% in 2016. Last year, mainstream auto giants (XLY) General Motors (GM), Ford (F), and Fiat Chrysler (FCAU) rose 17.7%, 3.0%, and 96.4% respectively.
Solid fundamentals could help it recover
In 4Q17, Ferrari reported EPS (earnings per share) of 0.71 euros, or $0.88, representing a 20.3% rise YoY (year-over-year). A jump up in its global sales along with a favorable product mix drove the company’s profit margins higher. In 2017, RACE’s adjusted EBIT (earnings before interest and tax) margin expanded YOY, to 30.3% from 28.3%.
During Ferrari’s 4Q17 conference call, management gave solid guidance for 2018. The company expects 2018 shipments of more than 9,000 units, representing a 7.2% rise from its 8,398 units shipped in 2017. The company also expects its positive revenue and profit margin trends to continue in fiscal 2018. In the next part, we’ll see how Harley-Davidson stock traded last week.