There are not many more recognisable global brands than Ferrari (RACE US), synonymous with performance, wealth, luxury, quality, cutting-edge technology, to name a few! What is more incredible about Ferrari is the consistency in its products, the consistency in sales, and ultimately, the consistency in earnings over a long period of time.
As the wealthy get wealthier around the globe, the demand for luxury ‘status’ items with continue to grow, and this is a theme that is very supportive of brands such as Ferrari. While the stock is not cheap, trading on 37x FY24 consensus earnings, the defensive qualities of their earnings underpinned by their ability to control the underlying supply/demand dynamic makes this a truly interesting stock to consider for the International Equities Portfolio.
- RACE has pulled back ~10% from recent highs, and we are adding the stock to our Hitlist, attracted by its defensive qualities.
