Two of the most iconic names in the automotive world are also publicly traded, but their investment profiles couldn't be more different. Let's analyze what the market is saying today.
Ferrari (RACE): Luxury, Margins, and Resilience
Ferrari is, at its core, a luxury company that manufactures cars. And that distinction changes everything. The 2025 annual results showed revenues of €7.1 billion (8% growth), EBIT exceeding €2.1 billion, and industrial cash flow surpassing €1.5 billion, despite some occasional quarterly missed targets.
The most striking aspect of Ferrari is its structural profitability: the profit margin exceeds 22%, and the return on equity (ROE) reaches 42.89%, figures more typical of the technology sector than the automotive industry. The company completed a €2 billion share buyback program, launched six new models in 2025, including its first all-electric sports car, and maintains the brand's exclusivity. Ferrari anticipates continued growth by 2026 with the launch of four new models.
The only point of contention is the valuation: it trades at a P/E ratio of almost 35, leaving little room for disappointment. Those who buy Ferrari are paying for the brand and predictability, not for a bargain price. Following the 2025 results, several analysts reinforced their strong buy recommendation.
Mercedes-Benz (MBG): Cheap, but with good reason
Mercedes is experiencing a more challenging period. Its 2025 results fell short of expectations, and the 2026 outlook is subdued, impacted by headwinds in China, tariffs, and currency pressures. The group expects its 2026 revenue to be at the same level as the previous year, with an EBIT margin in cars of between 3% and 5%.
In the current environment, it is difficult to identify short-term catalysts; a stabilization of the business in China and a sustained recovery in margins would be key. On the plus side, the stock appears to be one of the most undervalued in the sector, with an enterprise value-to-sales ratio of just 0.14, and investors seeking yield may find it attractive given its current dividend of over 6%.
The Verdict
For a growth and quality-oriented investor, Ferrari is the strongest bet: a predictable business, exceptional margins, and an indestructible brand. For a value or income-oriented investor, Mercedes could be attractive due to its low price and generous dividend, although short-term risks are real and analysts do not agree on a recovery.
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