Berenberg Starts Ferrari (RACE) at Buy
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Berenberg initiates coverage on Ferrari (NYSE: RACE) with a Buy rating and a price target of EUR65.00.
Analyst Alexander Haissl commented, "Ferrari's key advantage resides firmly in its brand power, which has been cultivated into a status beyond a typical luxury brand. The value of the brand is reflected financially in the company’s ability to raise prices, and we think this is the principal driver of earnings growth over the next five years. Since the mid- 1990s, Ferrari has increased average prices of its fleet by around +2.5% annually, based on our estimates. We view price rises of +4% as readily achievable over the coming years, closer to the inflation of higher-end luxury goods products, and margins rising to 25% by 2020E."
Shares of Ferrari closed at $53.43 yesterday.
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