It's been a pretty great week for Ferrari N.V. (NYSE:RACE) shareholders, with its shares surging 13% to US$202 in the week since its latest quarterly results. The result was positive overall - although revenues of €888m were in line with what the analysts predicted, Ferrari surprised by delivering a statutory profit of €0.92 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Ferrari from 18 analysts is for revenues of €4.23b in 2021 which, if met, would be a major 28% increase on its sales over the past 12 months. Per-share earnings are expected to leap 43% to €3.97. Before this earnings report, the analysts had been forecasting revenues of €4.21b and earnings per share (EPS) of €3.96 in 2021. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
There were no changes to revenue or earnings estimates or the price target of €176, suggesting that the company has met expectations in its recent result. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Ferrari at €264 per share, while the most bearish prices it at €117. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ferrari's past performance and to peers in the same industry. It's clear from the latest estimates that Ferrari's rate of growth is expected to accelerate meaningfully, with the forecast 28% revenue growth noticeably faster than its historical growth of 4.6%p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 22% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Ferrari to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Ferrari analysts - going out to 2023, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 1 warning sign for Ferrari that you need to be mindful of.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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