PLynchJr Posted October 27, 2015 Share Posted October 27, 2015 Well that didn't take long...already trading below IPO price. Link to comment Share on other sites More sharing options...
merkhet Posted October 27, 2015 Share Posted October 27, 2015 Well that didn't take long...already trading below IPO price. We'll see what happens tomorrow when they announce earnings. Link to comment Share on other sites More sharing options...
fareastwarriors Posted November 16, 2015 Share Posted November 16, 2015 Ferrari Shares Slide to New Low After Analysts Initiate Coverage http://blogs.wsj.com/moneybeat/2015/11/16/ferrari-shares-slide-to-new-low-after-analysts-initiate-coverage/ Link to comment Share on other sites More sharing options...
fareastwarriors Posted November 16, 2015 Share Posted November 16, 2015 Ferrari's Pricing Power Is in Overdrive Between its brand image and its scarcity, this automaker is in the driver's seat. http://news.morningstar.com/articlenet/article.aspx?id=723142 Link to comment Share on other sites More sharing options...
cmlber Posted November 16, 2015 Share Posted November 16, 2015 Ferrari's Pricing Power Is in Overdrive Between its brand image and its scarcity, this automaker is in the driver's seat. http://news.morningstar.com/articlenet/article.aspx?id=723142 This guy is an idiot, so take this with a huge grain of salt. He says at 1.07 euro his Ferrari fair value is $50, but if the euro strengthens to 1.30 Ferrari would be worth $60. Ferrari is worth substantially more in dollars with a weaker, not stronger, euro. All of the costs are in euro but more than 50% of the revenue is in dollars.... "Our fair value estimate is $50 per share and assumes a U.S. dollar/euro conversion ratio of 1.0744, annualized 6% revenue growth, margin expansion until our midcycle assumptions in the final year of five-year forecast, and an 8.7% weighted average cost of capital. Since Ferrari's financials are in euros while the stock trades in U.S. dollars on the NYSE, currency translation affects our fair value relatively significantly. For every $0.05 increase or decrease in the exchange rate, our fair value estimate rises or declines by roughly $2.30. If the euro strengthened relative to the dollar to a conversion ratio of $1.30, commensurate with historical levels, our fair value estimate would be $60." Link to comment Share on other sites More sharing options...
SwimmingNaked Posted November 16, 2015 Share Posted November 16, 2015 Ferrari's Pricing Power Is in Overdrive Between its brand image and its scarcity, this automaker is in the driver's seat. http://news.morningstar.com/articlenet/article.aspx?id=723142 This guy is an idiot, so take this with a huge grain of salt. He says at 1.07 euro his Ferrari fair value is $50, but if the euro strengthens to 1.30 Ferrari would be worth $60. Ferrari is worth substantially more in dollars with a weaker, not stronger, euro. All of the costs are in euro but more than 50% of the revenue is in dollars.... "Our fair value estimate is $50 per share and assumes a U.S. dollar/euro conversion ratio of 1.0744, annualized 6% revenue growth, margin expansion until our midcycle assumptions in the final year of five-year forecast, and an 8.7% weighted average cost of capital. Since Ferrari's financials are in euros while the stock trades in U.S. dollars on the NYSE, currency translation affects our fair value relatively significantly. For every $0.05 increase or decrease in the exchange rate, our fair value estimate rises or declines by roughly $2.30. If the euro strengthened relative to the dollar to a conversion ratio of $1.30, commensurate with historical levels, our fair value estimate would be $60." Was just gonna comment on this, that was pretty silly. He is actually one of the few analysts who seems to understand Ferrari's attractiveness as an investment though (heard him make a comment on the CC where it seemed like he got that there's going to be expansion in margins coming from operating leverage, and also understands the pricing power + economic resilience of the biz). Granted Ferrari is still new to Wall Street, but some of the stuff I've heard about it so far has been so stupid that it hurts (Damodaran's analysis made me cringe). Link to comment Share on other sites More sharing options...
grandmasterG Posted November 22, 2015 Share Posted November 22, 2015 true, there have been lot of comments on Ferrari from people who only have a superficial knowledge of its business model and future potential one element that is also key and almost never mentioned is that Marchionne apparently had a disagreement with the former ceo about lifting the production numbers or not, a few months ago that ceo was fired and now Ferrari can start to gradually increase production towards 10.000 a year in the coming years if they do this by lifting production of there more expensive models (where waitings list are sometimes over 2 years) then profits can rise significantly in the coming 2-3 years therefore it would be a mistake to concentrate on the fact that they are trading at maybe 30 times this year's earnings study Hermès to see how a company with limited production can easily increase profits each year, simply by raising prices , I think Hermès is probably the company that resembles Ferrari the most Link to comment Share on other sites More sharing options...
bbarberayr Posted December 14, 2015 Share Posted December 14, 2015 Ferrari shares set to start trading in Italy on the 4th, so would assume here at the same time. Going to be interesting to see what happens to RACE prices and FCAU as well actually as FCAU shareholders buy and sell to hold which of the 2 companies they really want. "As previously announced, the listing of the common shares of Ferrari on the MTA is part of a series of transactions intended to separate Ferrari N.V. from Fiat Chrysler Automobiles N.V. and to deliver to holders of FCA common shares Ferrari common shares in accordance with a spin-off ratio of one Ferrari common share for every ten FCA common shares. These transactions are expected to be carried out between December 31, 2015 and January 3, 2016 and Ferrari shares are expected to commence trading, subject to completion of the separation, on January 4, 2016." Link to comment Share on other sites More sharing options...
Phaceliacapital Posted December 18, 2015 Author Share Posted December 18, 2015 http://finance.yahoo.com/news/buyside-action--buy-ferrari-190625810.html Link to comment Share on other sites More sharing options...
feynmanresearch Posted December 19, 2015 Share Posted December 19, 2015 http://www.gwinvestors.com/2015/12/16/ferrari-video/ Link to comment Share on other sites More sharing options...
jay21 Posted January 3, 2016 Share Posted January 3, 2016 So the valuation rests on unit expansion. Given current FCF, it looks like at least some improvement is priced in. If production moves towards 10k and margins expand, this is probably worth double? Maybe this works. Its like right on the cusp of interesting to me. Link to comment Share on other sites More sharing options...
Phaceliacapital Posted January 4, 2016 Author Share Posted January 4, 2016 I think the valuation is currently still somewhat stretched, but I guess most of us here got the shares rather cheap (not to say free, I paid an average EUR 4 for my shares). I believe Ferrari is one of those long term holding stories such as Visa, Amex etc, always is and always will be too expensive.. Link to comment Share on other sites More sharing options...
bbarberayr Posted January 4, 2016 Share Posted January 4, 2016 Anyone see the RACE stocks in their account yet? I am with TD Canada and have not Link to comment Share on other sites More sharing options...
merkhet Posted January 4, 2016 Share Posted January 4, 2016 I see RACE WI and RACE in my IBKR and TD Ameritrade accounts, respectively. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted January 4, 2016 Share Posted January 4, 2016 Anyone see the RACE stocks in their account yet? I am with TD Canada and have not Nothing in my account at Scottrade so far - it's not unusual though. They're generally behind on this sort of thing. Link to comment Share on other sites More sharing options...
investor-man Posted January 4, 2016 Share Posted January 4, 2016 Not seeing it in Fidelity Link to comment Share on other sites More sharing options...
kranthi_vic Posted January 4, 2016 Share Posted January 4, 2016 Merill informed me the shares are due on 7th. Are they trading only in Milan from today? Link to comment Share on other sites More sharing options...
simplefocus Posted January 4, 2016 Share Posted January 4, 2016 The RACE shares show in my Ameritrade account but not my Fidelity account. Link to comment Share on other sites More sharing options...
fareastwarriors Posted January 4, 2016 Share Posted January 4, 2016 I see the shares in eTrade but not my TradeKing. Link to comment Share on other sites More sharing options...
compoundinglife Posted January 4, 2016 Share Posted January 4, 2016 Arrived in my Etrade account late last week. Just checked TDAmeritrade today and they are there. Still not there in Fidelity or Schwab Link to comment Share on other sites More sharing options...
mankap Posted January 4, 2016 Share Posted January 4, 2016 I do not see it in my optionshouse account Link to comment Share on other sites More sharing options...
Guest Grey512 Posted January 4, 2016 Share Posted January 4, 2016 I actually think RACE could be a decent short for 2016, though I'll probably get massively flamed by y'all for saying this. Link to comment Share on other sites More sharing options...
fareastwarriors Posted January 4, 2016 Share Posted January 4, 2016 I actually think RACE could be a decent short for 2016, though I'll probably get massively flamed by y'all for saying this. What is your short thesis? Link to comment Share on other sites More sharing options...
cmlber Posted January 4, 2016 Share Posted January 4, 2016 I actually think RACE could be a decent short for 2016, though I'll probably get massively flamed by y'all for saying this. What's the rationale? Have you spent any time on it? 140m euro in EBIT in Q3 selling 1,949 cars. That's a 7,796 car pace for the year, in line with guidance for 2015. 140m x 4 = 560m euro run-rate EBIT for 2015. That's without the massive euro tailwind as they are currently hedged. Check out the prospectus, it says 44% of company revenue is exposed to foreign currency risk. Check out where they sell, the basket of currencies that make up that 44% of revenue is up ~17% against the Euro YTD. What happens when you bump 1.2b euro in revenue up by 17% with no increase in cost (all in euro)? What does that do to the bottom line of a 560m euro EBIT company? Even without that though, on 2015 hedged #'s they're at 16x EV/EBIT for a recession proof business that can raise prices by 3-5%/year forever and can sell an extra 2,200 units easily at 150k incremental margins per car for another 330m euro in EBIT. Link to comment Share on other sites More sharing options...
Guest Grey512 Posted January 4, 2016 Share Posted January 4, 2016 cmlber - I am a former FCA long. I agree with some of what you say, but I have less confidence in the incremental volumes and the sustainability of price increases and the margin outlook. Unlike you, I don't think 16x EBIT is good value for this. Briefly, besides valuation, some of the reasons to short are: Fashion. Psychology. Positive beta on inequality. Negative beta on commodity prices. Negative beta on EM currencies. Regulatory trends on fuel/engine efficiencies. And of course - high expectations. Sorry for using the word beta so many times. At current prices, I see more downside than upside in the near/medium term. The problem is the (cost) of borrow. Perfectly happy to reverse my stance and go long at lower prices. Link to comment Share on other sites More sharing options...
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