Head-To-Head Review: Ferrari (NYSE:RACE) & Faraday Future Intelligent Electric (NASDAQ:FFAI)

Faraday Future Intelligent Electric (NASDAQ:FFAI) and Ferrari (NYSE:RACE) are both auto/tires/trucks companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, valuation, profitability and analyst recommendations.

Analyst Ratings

This is a breakdown of recent recommendations for Faraday Future Intelligent Electric and Ferrari, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Faraday Future Intelligent Electric	1	1	1	0	2.00
Ferrari	0	6	8	3	2.82

Faraday Future Intelligent Electric currently has a consensus target price of $5.00, suggesting a potential upside of 719.67%. Ferrari has a consensus target price of $482.17, suggesting a potential upside of 27.28%. Given Faraday Future Intelligent Electric’s higher possible upside, equities analysts plainly believe Faraday Future Intelligent Electric is more favorable than Ferrari.

Insider and Institutional Ownership

71.7% of Faraday Future Intelligent Electric shares are held by institutional investors. 0.4% of Faraday Future Intelligent Electric shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Faraday Future Intelligent Electric and Ferrari”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Faraday Future Intelligent Electric	$540,000.00	222.20	-$355.85 million	($1.84)	-0.33
Ferrari	$8.08 billion	11.36	$1.81 billion	$10.11	37.47

Ferrari has higher revenue and earnings than Faraday Future Intelligent Electric. Faraday Future Intelligent Electric is trading at a lower price-to-earnings ratio than Ferrari, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Faraday Future Intelligent Electric has a beta of 5.24, meaning that its stock price is 424% more volatile than the S&P 500. Comparatively, Ferrari has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Profitability

This table compares Faraday Future Intelligent Electric and Ferrari’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Faraday Future Intelligent Electric	-74,517.13%	-518.14%	-91.88%
Ferrari	22.36%	44.36%	16.68%

Summary

Ferrari beats Faraday Future Intelligent Electric on 10 of the 15 factors compared between the two stocks.

About Faraday Future Intelligent Electric

Faraday Future Intelligent Electric Inc. engages in the design, development, manufacture, engineering, sale, and distribution of electric vehicles and related products in the United States and internationally. The company was founded in 2014 and is headquartered in Gardena, California.

About Ferrari

Ferrari N.V., through its subsidiaries, engages in design, engineering, production, and sale of luxury performance sports cars worldwide. The company offers range, special series, Icona, and supercars; limited edition supercars and one-off cars; and track cars. It also provides racing cars, and spare parts and engines, as well as after sales, repair, maintenance, and restoration services for cars; and licenses its Ferrari brand to various producers and retailers of luxury and lifestyle goods. In addition, the company operates Ferrari museums in Modena and Maranello; Il Cavallino restaurant in Maranello; and theme parks in Abu Dhabi and Spain. Further, it provides direct or indirect finance and leasing services to retail clients and dealers; manages racetracks; develops and sells a range of apparel and accessories; and operates franchised and owned Ferrari stores. The company also sells its products through a network of authorized dealers operating points of sale, as well as through its website. The company was founded in 1947 and is headquartered in Maranello, Italy.