Key Points
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Ferrari shipped 3,368 cars during the third quarter, but diluted earnings per share increased by 14%.
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Pricing power, supported by the brand’s rich heritage and management’s focus on capping supply, is key to the company’s financial success.
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Investors can buy Ferrari stock right now as it trades 19% off its record.
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Ferrari (NYSE:RACE) shares currently trade 19% off their peak (as of Nov. 10), but they have soared 23% over the past six months. The company is starting to hit the gas pedal on market sentiment.
The fundamentals are in top shape. In Q3 (ended Sept. 30), Ferrari reported year-over-year revenue growth of 7.4%. Its diluted earnings per share (EPS) climbed at an even faster 14%.
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These figures came in better than analyst expectations. Management gave investors another reason to cheer when they raised full-year guidance, now expecting higher sales and profitability.
These strong metrics were posted even though Ferrari sold 3,368 cars during the three-month period, a 1% decline from Q3 2025. That dip is not unusual for this corporate strategy. There’s one number that explains why this trend doesn’t hurt the financials.
Image source: Getty Images.
Scarcity is critical to the strategy
Ferrari’s headline numbers reveal a business that’s performing well. For shareholders, this is a very encouraging sign. During a period of global economic uncertainty, the company can still put up impressive financial results. And that shows just how resilient it is.
Ferrari shipped 1% fewer vehicles in Q3 compared to the year-ago period. “Shipments were deliberately planned slightly lower to allow for the smooth completion of the model changeover,” chief financial officer Antonio Picca Piccon said on the Q3 2026 earnings call. The business is in the process of meaningfully phasing out older cars and ramping up production of newer ones.
Diluted EPS still jumped 14%, however. The variable that explains this is pricing power. The vehicle average selling price was up 8%, which always seems to drive the financials.
There’s nothing more important to this business’s success than its brand. A rich racing heritage adds appeal. And it brings engineering and technological breakthroughs that play to the performance of these vehicles.
Additionally, the leadership team continues to stay true to the DNA of strictly controlling production to keep customers wanting more. Demand must always exceed supply to aid pricing power.
Personalization activity was also better than expected, representing 21% of car and parts revenue. This captures customers who want to customize their already expensive car purchases with different materials, colors, and features for both the interior and exterior. For Ferrari, this introduces a high-margin revenue source. Personalizations also demonstrate the collectible appeal of these supercars.
Investors shouldn’t group Ferrari with its automotive industry peers. Its earnings power, indicated by a robust operating margin of 29.7%, is proof that it’s a different breed. Selling fewer vehicles would be a damaging trend for mass-market car companies, and it’s something outside their control. But Ferrari can shrug it off since unit volume is a deliberate action.
This company should be viewed side by side with luxury goods purveyors. Only the wealthiest people qualify as potential customers. Having a highly sought-after source of demand like this means that interest doesn’t fluctuate as much when economic winds change. Ferrari’s historical financial performance proves this.
Consider buying the dip
Warren Buffett once discussed how pricing power is the signature of a high-quality company. Taken at face value, the legend’s words mean that Ferrari is an exceptional business. Consequently, any long-term investor would be wise to at least add the stock to their watch lists.
The setup right now is intriguing. As noted, shares trade 19% off their record high, set on July 25, 2025. Since that all-time high, the S&P 500 (SNPINDEX:^GSPC) has risen 17%. It’s not that common to see Ferrari stock register a subpar showing like this.
Prospective investors have a nice entry point to own a historical winner, a company that can help you sleep well at night. These shares have soared 666% in the last decade, driven by consistent top- and bottom-line growth. Consider buying the dip on Ferrari.
Should you buy stock in Ferrari right now?
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ferrari. The Motley Fool has a disclosure policy.
