Competition
is
heating
up
in
the
electric
vehicle
industry,
especially
between
investor
favorite
Tesla
and
Chinese
automakers
like
the
Warren
Buffett-backed
BYD
.
However,
one
fund
manager
has
some
serious
reservations
about
the
sector.
“EVs
really
took
off
and
captured
our
mindshare
5,
6,
7
years
ago,
[but]
they’re
not
really
successful
yet,”
Freddie
Lait,
chief
investment
officer
at
Latitude
Investment
Management,
told
CNBC’s
Pro
Talks
.
He
said
that
most
EV
businesses
had
not
succeeded
in
making
money
yet,
given
the
“extraordinary”
amount
of
capital
invested
initially.
“I
think
it’s
still
going
to
another
three
to
five
years
until
we
know
who
the
winners
in
electric
vehicles
are,”
Lait
said
on
Feb.
21.
He
manages
over
$750
million
across
the
Latitude
Horizon
Fund
and
the
Latitude
Global
Fund
.
“We
don’t
own
any
of
the
[EV]
auto
manufacturers
and
I
think
the
arms
race
to
develop
EVs
is
going
to
be
profitless
for
a
lot
of
these
businesses,
including
Tesla.
So,
I
would
avoid
it
all,
I’m
afraid,”
he
added.
The
fund
manager
instead
has
his
sights
on
what
he
calls
“bigger
integrated
covers,”
such
as
Italian
sports
car
manufacturer
Ferrari
,
as
well
as
General
Motors
,
Volkswagen
and
BMW
.
‘Phenomenal’
Ferrari
Lait
described
Ferrari
in
particular
as
“a
phenomenal
business.”
Its
shares
have
been
on
the
up
over
the
last
few
weeks
after
it
reported
a
17%
jump
in
full-year
revenue
for
2023
and
struck
a
bullish
tone
on
2024.
Ferrari
trades
under
the
ticker
RACE
on
the
New
York
Stock
Exchange
and
Euronext
Milan.
Over
the
last
12
months,
its
U.S.
shares
are
up
over
55%,
well
outperforming
the
broader
S
&
P
500
.
The
company
—
known
for
its
supercars
—
plans
to
launch
its
first
all-electric
vehicle
in
2025.
RACE
YTD
mountain
Year-to-date
performance
of
Ferrari
shares
on
the
Euronext
Milan
Lait’s
confidence
in
Ferrari
is
echoed
by
analysts
at
UBS
who
have
reiterated
their
buy
rating
on
the
stock
with
a
12-month
price
target
of
$448
—
up
from
$413
previously.
“We
think
RACE
stands
out
as
a
key
defensive
play
in
an
increasingly
uncertain
macro
context
and
slowing
demand
in
the
broader
luxury
sector,
thanks
to
its
exposure
to
HNWIs
(high
net
worth
individuals)
and
the
visibility
provided
by
record
order
books
covering
all
of
2025
and
beyond,”
they
wrote
in
a
note
last
month.
Similarly
Morgan
Stanley’s
analysts
–
who
are
overweight
on
Ferrari
–
flagged
the
company’s
“positive
risk
reward
skew,
with
upside
to
our
bull
case
exceeding
downside
to
our
bear
case
by
more
than
2:1,
as
well
as
the
resilient
business
model.”
Other
aspects
of
the
company
they
like
include
the
fact
that
most
limited-edition
model
launches
instantly
sell
out,
and
the
fact
that
the
automaker
has
a
two-year
order
book.
According
to
Factset
data,
of
24
analysts
covering
the
stock,
11
give
it
a
buy
or
overweight
rating,
while
12
have
hold
ratings
and
one
has
a
sell
rating.
The
average
price
target
on
Ferrari
is
391.96
euros
($425.14),
according
to
FactSet
data,
giving
it
potential
downside
of
around
8%.
—
CNBC’s
Michael
Bloom
contributed
to
this
report.
