In this article, we will discuss the 12 Best Italian Stocks to Buy in 2025.
As per Deloitte, the broader Italian economy slowed down in 2024, with moderate growth. The service sector expansion was contrasted with continued weakness in essentially all other sectors, mainly in manufacturing and automotive. The consumer and business sentiments in Italy were low across 2024, in the context of weakness in the critical economies of the euro area too.
On the supply side, the broader GDP growth was only supported by the services sector in 2024, while essentially all other sectors witnessed a decline. With these impacts now behind us, what lies ahead for the broader Italian economy?
Inflation Is Expected to Remain Moderate, Says Deloitte
In Italy, inflation slowed down in 2024 and remained the lowest for well-established European economies, added Deloitte. That being said, electricity and gas prices were higher in Italy in comparison to other large European economies including France and Germany, influencing the competitiveness of Italian companies. In 2025, Deloitte sees inflation to remain below the levels expected in the euro area and the ECB target of 2%.
Therefore, moderate inflation, along with nominal wage growth, can result in a gradual recovery in real wages. In general, the broader Italian labor market witnessed a contraction last year. Notably, while the number of employed people continues to increase, hours worked have witnessed a decline, primarily in the industrial sector. Deloitte believes that the broader Italian economy will maintain moderate positive growth in 2025, mainly in line with the anticipated average for euro-area economies. While it can face slightly higher consumer inflation, the levels will be lower than the euro area average. BNP Paribas believes that Italy still has the second lowest inflation in the Eurozone after Ireland. However, as elsewhere, inflation increased in January because of less energy deflation.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
GDP Expansion on the Cards, Says Allianz Trade
As per Allianz Trade, Italy witnessed a strong recovery from the pandemic and was one of the best performers among the 4 major Eurozone economies. Even though GDP is now 5.6% above pre-pandemic levels, the broader economic activity witnessed a slowdown in recent quarters. It even stagnated (in real quarterly terms) in Q3 2024. However, private consumption growth resumed in 2024, with confidence recovering alongside the strong decline of inflation.
Moving forward, Allianz Trade sees private consumption picking up due to a recovery in income and an easing of monetary policy. Notably, a catch-up in NGEU spending is expected to make up for the partial recovery of investment activity. In 2025, the firm anticipates GDP to expand by 0.8%, followed by 1% in the following year.
Amidst these trends, let us now have a look at the 12 Best Italian Stocks to Buy in 2025
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Our Methodology
To list the 12 Best Italian Stocks to Buy in 2025, we used a screener and sifted through several online rankings. Next, we chose the companies having headquarters in Italy and in which analysts saw upside potential. Finally, the stocks were arranged in ascending order of their average upside potential, as of February 10. We also mentioned hedge fund sentiments from Insider Monkey’s database of 900 elite hedge funds, as of Q3 2024.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
12 Best Italian Stocks to Buy in 2025
12) Ferrari N.V. (NYSE:RACE)
Number of Hedge Fund Holders: 36
Average Upside Potential: ~5%
Headquartered in Maranello, Italy, Ferrari N.V. (NYSE:RACE) is engaged in designing, engineering, producing, and selling luxury performance sports cars. UBS upped the company’s price target to $584 from $513, keeping a “Buy” rating. Its results demonstrated the strength of the business model and the brand, with high-end demand exceeding supply despite macro conditions, says the analyst. Notably, Ferrari N.V. (NYSE:RACE) released its consolidated preliminary unaudited results for Q4 2024 and 12 months ended December 31, 2024, with annual net revenues of €6,677 million, up 11.8% YoY and total shipments of 13,752 units.
Furthermore, in 2025, the company expects a positive product and country mix, together with strong personalizations. Ferrari N.V. (NYSE:RACE) also expects an improvement in contribution from racing activities, implying higher sponsorships and commercial revenues linked to the better Formula 1 ranking achieved in 2024. The company’s strategic focus on sustainability and strong order book strengthens confidence in its future growth prospects.
Ferrari N.V. (NYSE:RACE) believes that lifestyle activities will expand its revenue growth rate in 2025, while it continues to invest to accelerate development and enlarge the network. Overall, the company’s financial results in 2024 were aided by a strong product mix and an increased demand for personalization.
11) UniCredit S.p.A. (OTC:UNCFF)
Number of Hedge Fund Holders: N/A
Average Upside Potential: ~5.1%
UniCredit S.p.A. (OTC:UNCFF) offers commercial banking services in Italy, Germany, Central Europe, and Eastern Europe. The company has its headquarters in Milan, Italy. On February 10, 2025, the Board approved the 4Q 2024 and FY 2024 consolidated results as of 31 December 2024. Its net interest income rose by 1.1% YoY to €3.7 billion, with a discipline of deposit pass-through, at an average of 34% in 4Q24, only marginally up as compared to the prior quarter. For 2025, UniCredit S.p.A. (OTC:UNCFF) remains focused on delivering strong returns to shareholders and setting the net profit guidance broadly in line with FY24.
Therefore, net revenue is guided more than €23 billion, with a moderate decline in FY 2025 NII, due to the anticipated lower interest rates environment and further compression of Russia. UniCredit S.p.A. (OTC:UNCFF) expects FY 2025 fees to be up mid-single digit percentage points compared to FY 2024, including the net insurance result. For 2027, UniCredit S.p.A. (OTC:UNCFF) expects a net profit of ~€10 billion, coupled with RoTE of more than 17% and an average FY 2025 – FY 2027 organic capital generation broadly in line with net profit.
UniCredit S.p.A. (OTC:UNCFF)’s investment case remains compelling, aided by an attractive geographic footprint, quality clients, and business mix. Furthermore, it remains well-positioned to absorb a normalization of interest rates and cost of risk and cost inflation.
10) Telecom Italia S.p.A. (OTC:TIIAY)
Number of Hedge Fund Holders: N/A
Average Upside Potential: ~8.1%
Telecom Italia S.p.A. (OTC:TIIAY) is engaged in the provision of fixed and mobile telecommunications services in Italy and internationally. The company is based in Rome, Italy. Kepler Cheuvreux upgraded the company’s stock to “Buy” from “Hold.” Telecom Italia S.p.A. (OTC:TIIAY) continues to focus on debt reduction which can place the company well for long-term growth. During Q3 2024, the company finalized the sale of NetCo to KKR, completing the transformation process. This led to a reduction in financial debt and the adoption of a new business model, allowing the company to compete more effectively in the market, courtesy of a greater focus on industrial components.
Elsewhere, Reuters reported that a treasury-led consortium submitted a new binding bid for Telecom Italia S.p.A. (OTC:TIIAY)’s subsea cable business, Sparkle. Notably, the proposal confirmed a Sparkle valuation of €700 million ($724.22 million). Sparkle has a 600,000 km cable network, transmitting information between countries in Europe, the Mediterranean, and the Americas. Therefore, it is deemed of strategic importance by the Italian authorities, reported Reuters.
Telecom Italia S.p.A. (OTC:TIIAY) further added that, during the quarter, cost containment actions targeted at increasing the level of structural efficiency of the domestic perimeter continued and ~80% of the target set for the current year was achieved. Its adjusted net financial debt after lease as of September 30, 2024 remained below €8 billion, down by over €0.1 billion as compared to the value immediately following the completion of the sale of NetCo.
