Ferrari shares jump 15% in first trades

Shares of Italian luxury car manufacturer Ferrari started the day trading at $60, 15% higher than their flotation price of $52 per share.

By 1506 BST they were up by an even more tempered 8.12% at $56.22.

On Tuesday, Ferrari priced its initial public offering at 52$ per share, towards the top part of the proposed valuation range.

That gave the Maranello-based firm a theoretical market capitalisation of approximately $9.8bn (£6.36bn).

In the run-up to the company’s debut on the New York Stock Exchange some analysts argued the company should be valued like luxury goods makers – at least in terms of EV/EBITDA multiples.

That meant that in terms of expected EV/EBITDA the firm could more or less justify a multiple of about 12.2, versus 5.9 for the global car industry. That was because the median EV/EBITDA for luxury brands was 11.2.

However, some market commentators highlighted the 5.6% drop in car shipments recorded in the first quarter as a counterargument against a premium valuation.

The firm’s Dutch registration and the fact that its main shareholders Exor – the investment vehicle for the Agnelli family, which is also the biggest investor in Fiat – retain the majority of the political rights also raised some eyebrows.

Nevertheless, Fiat Sergio Marchionne’s announcement of his intention to list the 10% stake in Ferrari back in October 2014 was seen as a contributing factor to the outperformance in Fiat’s share price since then.

As of 1550 BST shares in Fiat were 4.01% lower at €13.65.