In the third week of June, Ferrari stock (RACE) turned negative after reaching its all-time high of $149.85 in the previous week. The stock fell 6.3% last week to $139.48. In May, the stock rose ~7.1%, and had risen 6.2% this month as of June 22. It had risen 15.7% in Q2 so far, while the S&P 500 had risen 4.3%. Let’s look at its key technicals this week.
Weekly technical update
Despite falling recently, Ferrari stock has stayed above its 50-day simple moving average of $132.97, suggesting medium-term bullishness. On June 22, the stock tested its support near $138, which should continue to act as immediate support this week. Its 14-day RSI (relative strength index) score was within overbought territory at 52.3, reflecting minor strength in its momentum.
Fundamentals remain strong
In Q1 2018, Ferrari’s EPS rose ~19% YoY (year-over-year) to 0.78 euros or $0.93. Its revenue rose 1.3% YoY, while its adjusted EBITDA rose significantly, by 13% YoY, thanks to its improved margins.
During Ferrari’s Q1 earnings call, it reiterated its guidance for 2018. The company expects its shipments to rise 7.2% YoY to ~9,000 units. It also expects its revenue and profit margins to continue to improve.
While Ferrari’s fundamentals are strong, rising US-Europe trade tension may be weakening its stock. As of June 15, Ferrari stock had risen by an impressive 33% this year, whereas peers (XLY) General Motors (GM), Fiat Chrysler (FCAU), and Tesla (TSLA) had risen 0.6%, 7.5%, and 7.2%, respectively. Continue to the next part to learn how Harley-Davidson performed on Wall Street last week.