2 Reasons to Buy This Hidden Gem Luxury Stock

2026-01-17 23:57:00 ET

Most investors wouldn't think to check the automotive industry for luxury stocks . That's because the auto industry is notorious for intense competition, low margins , and a high price of doing business in a capital-intensive industry. Ferrari (NYSE: RACE) however, is truly a hidden gem because it flips many of the automotive investing stereotypes on their head. Let's take a closer look at this unique luxury super-car maker and identify two reasons investors can buy into this winner.

The first thing that potential investors should know about Ferrari is about its industry-thumping margins. Ferrari is known for keeping a lid on its sales, limiting its book orders, and notoriously selling one fewer vehicle than the market demands to drive its pricing power. Furthermore, in part because the super-car maker introduces new technology on each vehicle, developed alongside its racing team, its pricing power is sustainable. It has proven this over time.

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