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Overview of the topics

• Stocks Highlights: Ferrari continues to dominate the Brand Strength Index (BSI) with an exceptional score of 91/100.
• Financial Data: Ferrari exceeded expectations with a significant 27% increase in core profit for the first quarter.
• Social Data: Ferrari faces strong competition from several notable luxury sports car manufacturers, firstly Lamborghini.
• Onchain Data: Scuderia Ferrari has joined other Formula One teams in ending partnerships with cryptocurrency sponsors.
• Deep Dive: Bitcoin experienced a notable surge in mid-June, reaching a one-year high above $31,000.

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Stocks Highlights

Ferrari as the strongest luxury brand

Ferrari, the renowned Italian luxury car brand, continues to dominate the Brand Strength Index (BSI) with an exceptional score of 91/100, earning it the top AAA+ rating.

The value of the brand has experienced a slight increase of 3%, reaching an impressive $7.2 billion. Its growth can be attributed to two factors. Firstly, its commitment to developing strategic electric components in-house. This initiative has positioned the firm at the very forefront of the electric vehicle market.

Secondly, the brand has enhanced its production flexibility for hybrid and fully electric models, allowing it to cater to the new demands of the market. However, what sets it apart is Ferrari's ability to maintain exclusivity while captivating a wide audience.

The company has achieved such equilibrium by establishing a presence in various domains, ranging from the world of Formula 1 to merchandising, high fashion, lifestyle, and even amusement parks. As a consequence, its brand familiarity remained remarkably high.

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Financial Data

Even Ferrari’s profits went to the moon

Ferrari exceeded expectations with a significant 27% increase in core profit for the first quarter. The luxury Italian sports car manufacturer also projected a strong second quarter, anticipating the launch of its highly anticipated Purosangue model, which already has waiting lists extending to 2026.

Due to unprecedented demand, Ferrari temporarily suspended orders for the Purosangue four-door, four-seater models. The CEO, Benedetto Vigna,

stated that he was caught “by positive surprise for this strong interest” and that the new orders for the petrol-powered 12-cylinder Purosangue, priced at €390,000 ($430,000), will have to wait until 2026 for delivery.

Ferrari's commitment is to maintain the exclusivity of the Purosangue by limiting its sales to less than 20% of the total group shipments throughout its lifespan and avoiding any extensions. Following the positive news, its shares on the Milan Stock Exchange rose by up to 5.6% on a single day, reaching a new record high of €267.20.

In the January-March period, Ferrari's adjusted earnings before interest, tax, depreciation and amortization (EBITDA) reached €537 million, surpassing analyst predictions of €508 million. Such results were driven by increased shipments, mainly led by the Portofino M, 296 GTB, and 812 Competizione models, as well as pricing adjustments.

CFO Antonio Picca Piccon informed analysts that Ferrari had implemented mid-single-digit price increases on selected models and markets. He has also mentioned that the company anticipated a robust second quarter, followed by a relatively weaker second half of the year, particularly in the fourth quarter, in line with their planned product release schedule.

Analysts noted that Ferrari's "extremely strong" product mix, pricing power, and extensive order book shielded the firm from potential cancellations driven by recessions.

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Social Data

Who can overtake Ferrari?

Ferrari faces strong competition from several notable luxury sports car manufacturers. Some of its main competitors are Lamborghini, McLaren, Aston Martin, Porsche, Bugatti, Mercedes-AMG, and BMW M Division.

Lamborghini, exactly as Ferrari, is an Italian automaker renowned for its high-performance sports cars which offer powerful engines and striking designs. McLaren, instead, is a British manufacturer that combines cutting-edge technology, lightweight construction, and aerodynamic design.

Aston Martin, another British luxury sports car brand, emphasizes elegance, craftsmanship, and thrilling performance in its handcrafted automobiles, providing strong competition to Ferrari. Even Porsche, a German automaker, is known for its iconic sports cars, which directly compete with Ferrari in terms of performance and prestige.

Also Bugatti, a French manufacturer, specializes in limited-production, high-performance cars that present fierce competition to Ferrari's broader market range.

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Onchain Data

Ferrari and crypto: is it still possible?

Scuderia Ferrari, the racing division of Ferrari, has joined other Formula One team in ending partnerships with cryptocurrency sponsors. This decision has resulted in a substantial $55 million loss for Ferrari as they prepare for the upcoming 2023 season.

The terminated partnerships include the deals with Velas Blockchain and Snapdragon, which aimed to enhance fan engagement through initiatives involving non-fungible tokens. The Velas partnership, valued at $30 million annually, was cut short due to Ferrari's noncompliance.

Mercedes and Red Bull Racing have also faced losses from severed crypto partnerships. Mercedes suspended its partnership with FTX as the crypto exchange filed for bankruptcy, resulting in a $15 million loss. In a similar way, Tezos Foundation decided not to renew its agreement with Red Bull Racing, citing a misalignment in strategy.

While teams face challenges in the crypto landscape, Formula One itself is exploring opportunities. The organization has plans to establish an online marketplace for cryptocurrencies, NFTs, and digital collectibles.

Ferrari's decision to end its crypto partnerships highlights the dynamics in Formula One and the complexities faced by teams in navigating the crypto landscape, while also underscoring the sport's aspirations to leverage cryptocurrencies and digital assets.

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Deep Dive

What happened to BTC in the meantime?

Bitcoin experienced a notable surge in mid-June, reaching a one-year high above $31,000. However, it later retraced below this threshold.

Currently, the largest cryptocurrency by market capitalization is trading at $30,894, showing a 2.1% increase in the past 24 hours. Over the course of the past week, Bitcoin has risen by approximately 20%.

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News of the week

• Banks: UK banks agree on limited mortgage relief measures for stressed borrowers. [Read more]
• Technology: US and India announce defense and technology deals during the visit. [Read more]
• Markets: Stock market today: Nasdaq ends lower as indexes post a losing week. [Read more]
• Investments: America’s plan to vet investments into China. [Read more]

Read the full version here.

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