Price Forecast:

Bullish Case: Ferrari's brand prestige continues to attract affluent buyers, bolstered by successful film and model releases. Strong demand for rare models and innovations in EV technology suggest a solid long-term trajectory, with the stock poised for recovery.

Bearish Case: Escalating competition in the luxury EV market and a potential global economic slowdown threaten sales. Concerns over brand reputation due to recent controversies can dampen investor sentiment and impact RACE’s stock negatively.

Potential Outcomes:

1) 30% high demand following successful models boosts price to $500+;

2) 25% market volatility reduces stock to $400;

3) 20% competition pressure leads to price stagnation;

4) 15% brand damage leads to < $350 price;

5) 10% recovery from film success pushes to $500+ in 2025.

Trading Oracle: Adopt a bullish stance by executing a debit spread: buy RACE $450 calls and sell $460 calls, both expiring in 60 days. This strategy capitalizes on anticipated recovery with limited downside risk, focusing on upcoming product launches and film-related brand boosts. Set target gains at 30% increase while minimizing exposure.

November 19, 2024