Stock market analysts and investors alike have remained skeptical about the strength of Ferrari’s stock since its IPO late last year, but billionaire hedge fund investor George Soros has now lent some credibility to the shares after purchasing a $31.2 million stake in the Italian automaker.
Soros’ purchase makes him the owner of a 0.45% stake in Ferrari, which according to Bloomberg has lent credibility to the stock after analysts slammed it for not being sustainable. Following Soros’ acquisition of his stake in the automaker, stock shot up 8% on the New York Stock Exchange and is sitting at $38.45 a share at the time of writing.
“Soros’s disclosure of an holding in Ferrari is clearly sending a positive signal to the investment community,” Vincenzo Longo, a strategist at IG Group in Milan, told Bloomberg in an interview.
According to Fortune, Citigroup’s rating of Ferrari stayed at ‘Neutral’ following Soros’ purchase and remains as such. Evercore ISI analysts told the publication it has a ‘Sell’ rating on Ferrari stock, describing its outlook as ‘underwhelming’. They may not be far off, with Ferrari sales expected to stagnate in 2016 amid a weak Chinese economy.