Ferrari vs Mercedes-Benz Which Is More Favorable?

Ferrari and Mercedes-Benz are two iconic car manufacturers with long-standing rivalries in the automotive industry. When it comes to their stocks, both companies are known for their strong performance and consistent growth over the years. Investors often compare the two stocks in terms of sales, brand reputation, and financial stability. As both companies continue to innovate and expand their product offerings, the competition between Ferrari and Mercedes-Benz stocks remains a highly debated topic among investors.

Ferrari or Mercedes-Benz?

When comparing Ferrari and Mercedes-Benz, 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 Ferrari and Mercedes-Benz.

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. Ferrari has a dividend yield of 0.55%, while Mercedes-Benz has a dividend yield of 9.18%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Ferrari reports a 5-year dividend growth of 22.88% year and a payout ratio of 1.80%. On the other hand, Mercedes-Benz reports a 5-year dividend growth of 5.20% year and a payout ratio of 50.61%.

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 Ferrari P/E ratio at 54.26 and Mercedes-Benz's P/E ratio at 5.42. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Ferrari P/B ratio is 23.27 while Mercedes-Benz's P/B ratio is 0.65.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Ferrari has seen a 5-year revenue growth of 0.81%, while Mercedes-Benz's is -0.08%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Ferrari's ROE at 44.82% and Mercedes-Benz's ROE at 11.79%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $450.76 for Ferrari and $59.23 for Mercedes-Benz. Over the past year, Ferrari's prices ranged from $330.15 to $498.23, with a yearly change of 50.91%. Mercedes-Benz's prices fluctuated between $53.78 and $83.50, with a yearly change of 55.26%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.