RACE is now overvalued and could go down -26%

Based on our analysis, Ferrari N.V. has received an overvalued rating of 2 out of 5 stars from Cashu. Several financial ratios indicate that the company's current valuation may not be justified when compared to its sector. Firstly, Ferrari's Price-to-Earnings (PE) Ratio stands at 51.00, significantly higher than the sector average of 15.61. A high PE ratio suggests that investors are paying a premium for each dollar of earnings, which may not be sustainable in the long term. This could indicate overvaluation, as the market is pricing in excessive growth expectations. Additionally, the Price-to-Book (PB) Ratio for Ferrari is 28.37, compared to the sector average of 1.97. This high PB ratio implies that investors are valuing the company far above its tangible assets, raising concerns about whether the premium is warranted based on the company’s book value. Moreover, the Dividend Yield for Ferrari is only 0.55%, while the sector average is 2.56%. A lower dividend yield may deter income-focused investors who seek regular cash returns from their investments, reflecting a less attractive value proposition. Lastly, while Ferrari boasts impressive performance metrics like a Net Profit Margin of 22.79% and a Return on Equity (ROE) of 43.06%, these strengths do not outweigh the concerns raised by the high valuation ratios. In summary, Ferrari N.V.'s elevated ratios in comparison to its sector peers suggest the stock may be overvalued, raising questions about its long-term investment potential. This is not a comprehensive overview of our valuation, and should not be viewed as financial advice. Always do your own research before considering an investment.