Barry SchwartzFerrari N.V.RACEPAST TOP PICKJul 19, 2021

Over 33% of owners buy more than one. Can't get a new one till 2028. Hybrid model doing well. Plans for EV. Price rises every year. Customization is pure profit for the company. Not cheap. He plans to hold for a long time. More than a car company, it's a brand.

Bought it last week. A leading luxry brand with profits like a software company. Limited production fuels their pricing power and competitive advantage. Trades at 4x profitable of a carmaker and 2x the consumer discretionary sector.

Good long term investment.
Continues to own shares.
Happy with company fundamentals.
Expecting further growth going forward. 
Demand for product very strong.
Pricing power very strong - able to keep up with inflation. 
Expecting double digit earnings growth. 
Electric vehicle on the way. 

RACE operates in a niche market, has artificial scarcity in sales volume, and has excellent brand loyalty. Its 5-year sales and earnings CAGR of 9.3% and 12.1%, respectively, are impressive, and the company has a good buyback program in place. Forward sales and earnings growth are expected to be strong and it has strong profit margins. Its valuation has become somewhat extended, with a forward sales multiple of 8.9X and a forward P/E of 45.1X. Free cash flows are good, and it has a nice cash balance of $1.5B. Its balance sheet is somewhat weak, with a small equity position and a high debt balance. Overall it's a fundamentally strong name, however, there is room for its valuation to contract and we would not be surprised by a pullback in price over the intermediate term. Generally, your investment is backed up by solid numbers, not just hype.

Nothing wrong with the business. Number of cars sold and pricing increases each year. Launching an SUV and EVs. Stock's not cheap and it never will be. Quality persists. Adding for new clients.

He has owned this for 3 or 4 years. The economy doesn't affect the super rich and there is a wait list for their cars. It is a high margin business and should double earnings in the next ten years.

He was late to this. They sell 9,000 cars a year and are expected to rise to 15,000. They're also developing e-cars and hybrids. They can increase prices and margins each year, and add anccillary services, like theme parks. An expensive PE but they should double earnings. Little debt, lots ot cash flow. He'd pay a higher valuation in a stock if he sees growth, like Ferrari. (Analysts' price target $130.41)

This is in the right demographic in that the rich 1% of the population is growing and growing. This company caters to that rich 1%. This is a niche product in a niche market.