Is RACE a good stock to buy? We came across a bullish thesis on Ferrari N.V. on Fazliddinxon’s Substack. In this article, we will summarize the bulls’ thesis on RACE. Ferrari N.V.’s share was trading at $354.91 as of June 12th. RACE’s trailing and forward P/E were 34.22 and 31.35 respectively according to Yahoo Finance.
Ferrari N.V., through its subsidiaries, engages in design, engineering, production, and sale of luxury performance sports cars worldwide. RACE is positioned as one of the most unique luxury businesses in public markets, with the investment thesis centered on the argument that the company should be viewed as a luxury ecosystem rather than a traditional automobile manufacturer. Unlike conventional automakers that compete through volume and face cyclical demand patterns, Ferrari operates under the economics of a Veblen good, where exclusivity and higher prices reinforce demand.
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The company deliberately restricts production below market demand, creating a durable scarcity moat that supports exceptional pricing power, industry-leading margins, and multi-year visibility. Ferrari’s order book is already filled through 2026 and into 2027, providing substantial revenue certainty and insulation from economic slowdowns, while nearly every vehicle is pre-sold and highly customized through its Tailor Made program, enhancing profitability.
The company’s financial profile more closely resembles elite luxury brands such as Hermès than automotive peers, supported by strong EBITDA margins and a highly affluent customer base. Ferrari also benefits from a unique marketing model through Scuderia Ferrari’s Formula One presence, allowing the brand to receive global exposure without relying on traditional advertising expenditures.
Additional growth is expected from the Purosangue, Ferrari’s high-margin entry into the luxury four-door segment, where production remains intentionally capped to preserve exclusivity. Meanwhile, investments in the new Maranello e-building provide vertically integrated capabilities for hybrid and electric vehicles while protecting the brand’s premium positioning.
Although valuation remains elevated and investors must monitor risks related to overproduction, brand dilution, and supply chain disruptions, the thesis views Ferrari as a cycle-resistant compounder with durable pricing power, expanding luxury demand, and long-term earnings growth supported by scarcity, brand strength, and continued margin expansion.
Previously, we covered a bullish thesis on Tesla, Inc. (TSLA) by Oliver | MMMT Wealth in April 2025, which highlighted the company’s long-term potential in autonomy, AI, robotics, energy, and data despite near-term operational challenges. TSLA’s stock price has appreciated by approximately 74.21% since our coverage. Fazliddinxon shares a similar view but emphasizes Ferrari N.V.’s (RACE) scarcity-driven luxury ecosystem, pricing power, and resilient demand as key drivers of long-term value creation.
Ferrari N.V. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 43 hedge fund portfolios held RACE at the end of the first quarter which was 44 in the previous quarter. While we acknowledge the risk and potential of RACE as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RACE and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
