5 Best Auto Stocks to Invest In

4. Ferrari N.V. (NYSE:RACE)

Number of Hedge Fund Holders: 33

Ferrari N.V. (NYSE:RACE) is perhaps one of the most iconic car companies in the world. Its brand of cars is among the most sought in the world and the company sells its products through its own retail stores and dealers. Ferrari N.V. (NYSE:RACE) is headquartered in Maranello, Italy.

For the first half of this year, the company’s free cash flows also grew by 45%, and through a targeted free cash flow growth of 10% for the next five years, the firm’s shares appear to be undervalued.

RBC Capital raised Ferrari N.V. (NYSE:RACE)’s share price target to EUR 261 from EUR 260 in August 2022. During this year’s June quarter, 33 of the 895 hedge funds polled by Insider Monkey had held a stake in the company.

Ferrari N.V. (NYSE:RACE)’s largest investor is Anand Desai’s Darsana Capital Partners which owns  1.2 million shares that are worth $229 million.

Ensemble Capital mentioned the company in its Q1 2022 investor letter. Here is what the fund said:

“Ferrari (7.3% weight in the Fund): As WE DESCRIBED a year ago in this letter, Ferrari’s chief marketing officer’s hardest job is not getting people to buy a Ferrari, but to tell some of them no. The company is in the business of selling rare, luxury products and so by design they greatly limited the number of vehicles they sell. This extreme constraint has led to a wait list of well over a year with a customer base so devoted to the company that even in the midst of the Financial Crisis of 2008-09, the number of vehicles they sold only declined by 4%. Their customers are so price insensitive, that the company often sells out of their limited edition super cars that sell for millions of dollars before they even announce the price. For a Ferrari collector the high prices are a feature, not a bug, as it is the price that makes Ferrari ownership so exclusive.”