After racing clear of its rivals for years, Ferrari has been relegated to the back row of the stock market grid.
The Italian supercar maker, the top performer in the Stoxx 600 Automobiles and Parts index for each of the past three years, has fallen by 5.6 per cent since the year began and suffered its worst quarter since the end of 2018.
That is a marked contrast to strong gains by rivals such as Volkswagen, which owns luxury brands Porsche, Bugatti and Lamborghini.
While competitors, particularly VW, have received a boost from the hullabaloo around electric vehicles, the company known for its Prancing Horse logo has run into setbacks including an underwhelming earnings forecast.
Without a clear electric vehicle strategy, Ferrari has also been hurt by an unresolved search for a new chief executive and a broader rotation out of growth names for a company that some investors regard more as a luxury play.
“The stock has become too expensive and earnings momentum is fading,” said Sanford C Bernstein analyst Arndt Ellinghorst.
The car maker gave a conservative earnings outlook for this year in February as it works through disruption from the pandemic on top of the search for a new leader.
Citing personal reasons, Louis Camilleri abruptly retired as chief executive in December, leaving the company facing its second leadership crisis in as many years and complicating the transition toward electric mobility.
Chairman John Elkann said last week that Ferrari was “making good progress with the search process to identify the right leader”.
Whoever takes the helm will face a challenging legacy, with Ferrari’s strategy for a fully electric vehicle remaining an unclear long-shot project.
Mr Camilleri cast doubts over the plan during his last analyst call in November, saying that he did not see the car maker going fully electric and “certainly, not in my lifetime will it reach even 50 per cent”.
However, Mr Elkann said in February that he envisaged Ferrari would make an all-electric car by the end of this decade.
A new chief executive will also need to combine the need to keep pace with tightening emissions regulations while satisfying the love of its power-hungry customers for the traditional thermal engine.
A spokesman for Ferrari declined to comment.
The stock’s lofty valuation multiple relative to other car makers does not leave much room for upset. According to RBC Capital analyst Tom Narayan, Ferrari is less of a car stock and “more of a luxury play”.
Reflecting that status among investors, Ferrari's shares rose by 28 per cent last year, similar to the performance of Birkin bag maker Hermes International and luxury leader LVMH, while most car makers' shares were weighed down by the pandemic.
“The outperformance last year was due to the fact that the stock is perceived as more defensive and something to own when everything else falls,” said Antonio Amendola, a portfolio manager at Acomea.
“In the end, those who can afford a Ferrari can afford it in any conditions.”
This year, stock market dynamics have changed, with investors shifting more toward cyclical stocks and away from defensives as the distribution of vaccines fuels optimism over a global economic recovery.
“With the market rotation, it is normal to see some profit taking,” said Mr Amendola. “Ferrari’s fundamentals are solid and this can be an opportunity to accumulate if the underperformance persists.”
According to UBS Group analyst Susy Tibaldi, concern over the company’s approach toward electric vehicles may not be fully justified.
“We do not think the company is under the same pressure and urgency as its non-luxury peers, due to the fact that a Ferrari per se is not a means of transport but rather a status symbol, and is rarely the first car in a household,” said Ms Tibaldi in a March 30 note.
She assigned a "buy" rating to the stock.
COMPANY PROFILE
Name: Rain Management
Year started: 2017
Based: Bahrain
Employees: 100-120
Amount raised: $2.5m from BitMex Ventures and Blockwater. Another $6m raised from MEVP, Coinbase, Vision Ventures, CMT, Jimco and DIFC Fintech Fund
Usain Bolt's World Championships record
2007 Osaka
200m Silver
4x100m relay Silver
2009 Berlin
100m Gold
200m Gold
4x100m relay Gold
2011 Daegu
100m Disqualified in final for false start
200m Gold
4x100m relay Gold
2013 Moscow
100m Gold
200m Gold
4x100m relay Gold
2015 Beijing
100m Gold
200m Gold
4x100m relay Gold
Super Rugby play-offs
Quarter-finals
- Hurricanes 35, ACT 16
- Crusaders 17, Highlanders 0
- Lions 23, Sharks 21
- Chiefs 17, Stormers 11
Semi-finals
Saturday, July 29
- Crusaders v Chiefs, 12.35pm (UAE)
- Lions v Hurricanes, 4.30pm
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
Graduated from the American University of Sharjah
She is the eldest of three brothers and two sisters
Has helped solve 15 cases of electric shocks
Enjoys travelling, reading and horse riding
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Ticket prices
General admission Dh295 (under-three free)
Buy a four-person Family & Friends ticket and pay for only three tickets, so the fourth family member is free
Buy tickets at: wbworldabudhabi.com/en/tickets
Funk Wav Bounces Vol.1
Calvin Harris
Columbia
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%20name%3C%2Fstrong%3E%3A%20ASI%20(formerly%20DigestAI)%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202017%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Quddus%20Pativada%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%2C%20UAE%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20Artificial%20intelligence%2C%20education%20technology%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EFunding%3A%3C%2Fstrong%3E%20%243%20million-plus%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20GSV%20Ventures%2C%20Character%2C%20Mark%20Cuban%3C%2Fp%3E%0A
'The Sky is Everywhere'
Director:Josephine Decker
Stars:Grace Kaufman, Pico Alexander, Jacques Colimon
Rating:2/5
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
HAJJAN
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More from Rashmee Roshan Lall
Previous men's records
- 2:01:39: Eliud Kipchoge (KEN) on 16/9/19 in Berlin
- 2:02:57: Dennis Kimetto (KEN) on 28/09/2014 in Berlin
- 2:03:23: Wilson Kipsang (KEN) on 29/09/2013 in Berlin
- 2:03:38: Patrick Makau (KEN) on 25/09/2011 in Berlin
- 2:03:59: Haile Gebreselassie (ETH) on 28/09/2008 in Berlin
- 2:04:26: Haile Gebreselassie (ETH) on 30/09/2007 in Berlin
- 2:04:55: Paul Tergat (KEN) on 28/09/2003 in Berlin
- 2:05:38: Khalid Khannouchi (USA) 14/04/2002 in London
- 2:05:42: Khalid Khannouchi (USA) 24/10/1999 in Chicago
- 2:06:05: Ronaldo da Costa (BRA) 20/09/1998 in Berlin
GIANT REVIEW
Starring: Amir El-Masry, Pierce Brosnan
Director: Athale
Rating: 4/5
How to vote in the UAE
1) Download your ballot https://www.fvap.gov/
2) Take it to the US Embassy
3) Deadline is October 15
4) The embassy will ensure all ballots reach the US in time for the November 3 poll
Electric scooters: some rules to remember
- Riders must be 14-years-old or over
- Wear a protective helmet
- Park the electric scooter in designated parking lots (if any)
- Do not leave electric scooter in locations that obstruct traffic or pedestrians
- Solo riders only, no passengers allowed
- Do not drive outside designated lanes
Ultra processed foods
- Carbonated drinks, sweet or savoury packaged snacks, confectionery, mass-produced packaged breads and buns
- margarines and spreads; cookies, biscuits, pastries, cakes, and cake mixes, breakfast cereals, cereal and energy bars;
- energy drinks, milk drinks, fruit yoghurts and fruit drinks, cocoa drinks, meat and chicken extracts and instant sauces
- infant formulas and follow-on milks, health and slimming products such as powdered or fortified meal and dish substitutes,
- many ready-to-heat products including pre-prepared pies and pasta and pizza dishes, poultry and fish nuggets and sticks, sausages, burgers, hot dogs, and other reconstituted meat products, powdered and packaged instant soups, noodles and desserts.
Indoor cricket World Cup:
Insportz, Dubai, September 16-23
UAE fixtures:
Men
Saturday, September 16 – 1.45pm, v New Zealand
Sunday, September 17 – 10.30am, v Australia; 3.45pm, v South Africa
Monday, September 18 – 2pm, v England; 7.15pm, v India
Tuesday, September 19 – 12.15pm, v Singapore; 5.30pm, v Sri Lanka
Thursday, September 21 – 2pm v Malaysia
Friday, September 22 – 3.30pm, semi-final
Saturday, September 23 – 3pm, grand final
Women
Saturday, September 16 – 5.15pm, v Australia
Sunday, September 17 – 2pm, v South Africa; 7.15pm, v New Zealand
Monday, September 18 – 5.30pm, v England
Tuesday, September 19 – 10.30am, v New Zealand; 3.45pm, v South Africa
Thursday, September 21 – 12.15pm, v Australia
Friday, September 22 – 1.30pm, semi-final
Saturday, September 23 – 1pm, grand final
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Mercedes-AMG GT 63 S E Performance: the specs
Engine: 4.0-litre twin-turbo V8 plus rear-mounted electric motor
Power: 843hp at N/A rpm
Torque: 1470Nm N/A rpm
Transmission: 9-speed auto
Fuel consumption: 8.6L/100km
On sale: October to December
Price: From Dh875,000 (estimate)
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MATCH INFO
Uefa Champions League semi-finals, first leg
Liverpool v Roma
When: April 24, 10.45pm kick-off (UAE)
Where: Anfield, Liverpool
Live: BeIN Sports HD
Second leg: May 2, Stadio Olimpico, Rome
How to help
Call the hotline on 0502955999 or send "thenational" to the following numbers:
2289 - Dh10
2252 - Dh50
6025 - Dh20
6027 - Dh100
6026 - Dh200
Sukuk explained
Sukuk are Sharia-compliant financial certificates issued by governments, corporates and other entities. While as an asset class they resemble conventional bonds, there are some significant differences. As interest is prohibited under Sharia, sukuk must contain an underlying transaction, for example a leaseback agreement, and the income that is paid to investors is generated by the underlying asset. Investors must also be prepared to share in both the profits and losses of an enterprise. Nevertheless, sukuk are similar to conventional bonds in that they provide regular payments, and are considered less risky than equities. Most investors would not buy sukuk directly due to high minimum subscriptions, but invest via funds.
