Alfa vs Ferrari Which Is More Lucrative?

Alfa and Ferrari are two iconic Italian automotive companies that have long been competing in the luxury car market. Investors often compare the two companies' stocks when considering their investment portfolios. Alfa Romeo, known for its elegant and stylish designs, has a rich history in the automotive industry. Ferrari, on the other hand, is synonymous with speed and performance, with its legendary sports cars capturing the hearts of enthusiasts worldwide. Understanding the differences in their financial performance and market positions can help investors make informed decisions when choosing between Alfa and Ferrari stocks.

Alfa or Ferrari?

When comparing Alfa and Ferrari, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Alfa and Ferrari.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Alfa has a dividend yield of 0.06%, while Ferrari has a dividend yield of 0.55%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Alfa reports a 5-year dividend growth of -9.64% year and a payout ratio of 0.00%. On the other hand, Ferrari reports a 5-year dividend growth of 22.88% year and a payout ratio of 1.80%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Alfa P/E ratio at -7.24 and Ferrari's P/E ratio at 53.70. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Alfa P/B ratio is 0.55 while Ferrari's P/B ratio is 23.03.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Alfa has seen a 5-year revenue growth of -0.17%, while Ferrari's is 0.81%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Alfa's ROE at -20.22% and Ferrari's ROE at 44.82%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are Mex$15.41 for Alfa and $446.46 for Ferrari. Over the past year, Alfa's prices ranged from Mex$9.94 to Mex$16.61, with a yearly change of 67.10%. Ferrari's prices fluctuated between $330.15 and $498.23, with a yearly change of 50.91%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.