prancing horse, PUBLISHED:
May 4 17:22
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Sharp acceleration to the downside for Ferrari shares. The stock slipped to its lowest levels since March 25 and recorded the worst performance among the stocks of the FTSE Mib, the blue chip index of the Italian stock exchange. Sales kicked off immediately after the first quarter results press release approved by the board today
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Sharp acceleration to the downside for Ferrari shares. The stock slips to its lowest levels since March 25 and scores the worst performance among the stocks of the FTSE Mib, the blue chip index of the Italian stock exchange. Sales kicked off immediately after the first quarter results press release approved by the board today.
Ferrari shares at the bottom of the FTSE Mib, but the first quarter results are good
The balance sheet data for the first three months of 2021 are up compared to the same period last year and better than analysts’ expectations (except for revenues). In detail, revenues show an 8% growth y / y at € 1.011 billion, but are lower than the Bloomberg consensus of € 1.032 billion.
Better indications regarding margins: EBITDA rises by 19% yoy to 376 million (consensus 368 million), EBIT by 21% to 266 million (consensus 253 million). The net result is equal to 206 million euros, + 24% compared to 166 in 2020 and higher than the 195 of the consensus.
Ferrari in red: actions penalized by the one-year postponement of targets due to Covid
So an overall positive quarterly report: why then has the reaction of Ferrari shares been so negative? Sales were triggered by management’s decision to postpone the targets previously set for 2022 by one year. The step backwards is the result of the prudential approach to investments adopted in 2020 and which will continue in 2021 in response to the Covid emergency.
However, interim president and CEO John Elkann said he was confident for the future: the good start of the year is an excellent premise for hitting the top of the objectives set for 2021 (revenues of approximately € 4.3 billion, adjusted EBITDA of € 1.5 billion, adjusted EBIT of € 1.02 billion, adjusted diluted earnings per share of € 4.20 and industrial free cash flow of approximately € 0.35 billion).
What prospects for Ferrari shares in the FTSE Mib? The word to technical analysis
Today’s massive decline has pushed Ferrari close to the supports positioned between 166 and 168 euros, decisive in the short term to avoid the hypothesis of a return to the low of the beginning of March at 154.40. In a more extended temporal perspective we can observe that the eventual violation of this last reference would create the conditions for a test of the base of the channel leading the rise since the beginning of 2019, decisive support in the medium to long term and currently in transit for 141-142. First signs of strength on the return above the 1.73 area, while the breach of the recent high of 183.15 would trigger an extension towards the historical record of 191.30 reached in the first session of 2021.