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Ferrari Stock at All-Time High after 1Q18 Earnings Beat

Jitendra Parashar - Author

Nov. 20 2020, Updated 11:50 a.m. ET

Ferrari stock at all-time high

World-renowned sports car maker Ferrari (RACE) released its 1Q18 earnings results yesterday. The company reported a 19% YoY (year-over-year) increase in its adjusted earnings to 0.78 euros or $0.93 per share in the first quarter this year. RACE also beat Wall Street analysts’ consensus estimates of 0.72 euros, which boosted investors’ confidence. As of 1:50 PM EST, Ferrari’s stock was up 4.7% for the session at an all-time high near $131.80.

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Stronger shipments and profits

In 1Q18, Ferrari’s global shipments went up 6% to 2,128 car units from 2,003 in 1Q17, which resulted in a 1% YoY rise in the company’s first-quarter revenues. Despite higher car shipments, unfavorable currency movement hurt its revenues in Q1 as its revenues were up 6% at a constant-currency rate.

Note that, just like its former parent company, Fiat Chrysler Automobile (FCAU), Ferrari also reports its earnings in euros. This is the reason why any strength in the euro hurts its global revenues and profits.

Ferrari’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) strengthened 13% YoY to 272 million euros or ~$326 million. Moreover, the company’s first-quarter EBIT margin also expanded to 25.3% in 1Q18 from 21.6% in 1Q17.

1Q18 earnings season

On May 2, Tesla (TSLA) released its biggest quarterly loss after the market closed, which triggered a sell-off in its stock on May 3. Other mainstream automakers (XLY) General Motors (GM), Ford (F), and FCAU released their earnings in the final week of April. Please visit Market Realist’s Autos page to stay updated on earnings reviews for these auto companies.

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