Tesla co-founder JB Straubel: We're using recycled EV batteries to power AI training data center
CNBC's Phil LeBeau talks with JB Straubel, Redwood Materials CEO and Tesla co-founder, to discuss the Redwood's new enterprise to convert EV car batteries into energy storage for data centers.
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Business Insider
21 minutes ago
- Business Insider
It's Time to ‘Pump the Brakes,' Says Analyst on Tesla Stock (TSLA)
Tesla (TSLA) is one of the most popular stocks among both Wall Street and retail investors, and understandably so, as the stock has generated phenomenal returns over the years, yielding a total return of 1,854% over the past decade. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter It has also captured the public's imagination with its forays into exciting fields like robotics and self-driving cars, as evidenced by this week's Robotaxi launch, which caused shares to surge 8% on Monday but have since pared gains to now trade ~2% lower. Despite this rally driven by Robotaxi enthusiasm, the stock is down nearly 30% from its 52-week high, which may lead some investors to look for the opportunity to 'buy-the-dip' on this popular name. However, the stock hardly appears to be a bargain at this point in time and may decline further. TSLA's Extreme Valuation Raises Eyebrows While Tesla (TSLA) is an intriguing self-driving stock, and the limited Robotaxi launch is generating considerable investor excitement, the stock is incredibly expensive from a valuation perspective. Shares of Tesla trade at an astronomical valuation of 169x 2025 earnings estimates. It's hard to understate how frothy this valuation is, but to put it into perspective, it's over eight times as expensive as the S&P 500 (SPX), which trades for 21x forward earnings estimates (and keep in mind that this is in and of itself a historically above-average valuation for the index). You can make the case that Tesla should be worth more than the 'average' company in the S&P 500, as the company and the rest of the Magnificent Seven stocks are some of the most dominant and innovative companies in the world. But not only is Tesla more expensive than the average stock in the S&P 500, it's also considerably more expensive than all of its magnificent seven peers, as TipRanks data shows. For comparison, Microsoft (MSFT) trades at 36x 2025 earnings estimates, while Amazon (AMZN) and Nvidia (NVDA), which have long been derided by many value investors for their lofty valuations, trade at similar valuations of 34x forward estimates for 2025 and 2026, respectively. Meta Platforms (META) and Apple (AAPL) both trade for roughly 27x 2025 estimates. Alphabet (GOOGL) is currently the cheapest stock in the Magnificent Seven, trading for just 18x 2025 estimates. TSLA is Priced for More Than Perfection When a stock is trading at such elevated valuation levels, it's often said to be 'priced for perfection.' But in this case, it's difficult to argue that everything is unfolding perfectly—significant risks remain. Elon Musk is widely regarded as a visionary CEO and brilliant engineer, but his tendency to court controversy is unparalleled, and it's increasingly cutting across political lines. While alienating one side of the political spectrum might be manageable—potentially offset by support from the other—Musk has managed to provoke backlash from both the left and the right in a relatively short period of time. His public support for Donald Trump during the presidential election alienated many on the left, while his subsequent high-profile dispute with Trump has also drawn criticism from the right. Although the details have been widely reported, the broader concern is that this bipartisan controversy could ultimately affect consumer sentiment and impact sales. When you pair this with the stock's lofty valuation, the potential downside risk becomes more pronounced. If Robotaxis are Overhyped, TSLA Could be in Trouble Let's take a closer look at Tesla's Robotaxi initiative, which has been driving the stock's momentum this week following a high-profile launch event in Austin. While the event generated significant media buzz, the substance of the launch was more modest. According to Reuters, only a small number of Teslas—each with a human safety monitor in the front seat—provided rides within a tightly geofenced area of Austin. Importantly, this was a private, invite-only event aimed at investors, influencers, and brand enthusiasts, rather than a public rollout. Many attendees posted their ride experiences on social media, adding to the event's visibility. That said, the launch was limited in both scale and scope. Even within this controlled environment, there were reported issues. The Verge noted an incident in which a Model Y briefly drove the wrong way down a street, while Tesla critic Ed Niedermeyer highlighted another case where a vehicle abruptly braked in traffic in response to a stationary object outside its path. These and similar reports have already prompted regulatory attention, with the National Highway Traffic Safety Administration reaching out to Tesla shortly after the event. It's also worth noting that Tesla is not alone in the autonomous vehicle space, and some competitors appear to be significantly further along. Alphabet's (GOOGL) Waymo, for instance, is already operating at scale, providing over 250,000 rides per week across cities like Los Angeles, San Francisco, and Phoenix. Having recently surpassed the 10-million ride mark, Waymo is quietly leading in real-world deployment, despite receiving far less media attention than Tesla. In this context, while Tesla's ambitions are noteworthy, its current progress in the Robotaxi space still lags behind established players. Is Tesla a Buy, Sell, or Hold? Turning to Wall Street, TSLA carries a Hold consensus rating based on 14 Buys, 12 Holds, and nine Sell ratings assigned in the past three months. The average TSLA stock price target of $291.31 implies 10.5% downside potential over the coming year. Sky-High Valuation Leaves Little Room for Error in Tesla's Stock While shares of Tesla have regained momentum based on robotaxi excitement, it's likely a good time to pump the brakes on this enthusiasm. The limited nature of the launch, strong competition already in place (and further ahead of Tesla), and the regulatory attention the company is already facing illustrate the challenges ahead. Robotaxis aside, Musk has demonstrated a remarkable ability to make enemies on both sides of the U.S. political divide, which has already led to a consumer backlash and could further harm sales. Despite these developments, the stock remains priced for perfection, trading at a sky-high price-to-earnings multiple—approximately 8.5x higher than the S&P 500 average—and at a premium well above any of its peers in the so-called 'Magnificent Seven.' The average analyst price target implies a potential 10% downside, and the consensus Hold rating underscores the elevated risk associated with the current valuation.
Yahoo
21 minutes ago
- Yahoo
Li Auto Just Slashed Its Forecast--But It's Betting Big on One Make-or-Break EV Launch
Li Auto (NASDAQ:LI), often seen as one of Teslas fiercest challengers in Chinas premium EV market, just dialed back its Q2 delivery guidanceby a lot. The company now expects to ship around 108,000 vehicles this quarter, down from its earlier estimate of 123,000128,000. The drop isnt due to slumping demand or production issues. Instead, management said it's the result of a temporary disruption as Li overhauls its internal sales systeman investment aimed at scaling more efficiently in the long run. Investors may not love the headline number, but this kind of short-term dip is sometimes the price of building for a bigger future. That future might arrive sooner than expected. The company is preparing for the launch of the Li i8, a new model that could redefine its product roadmap and kick off a fresh sales cycle. Executives say the internal restructuring should be done before the i8 hits the streetspositioning Li Auto to embrace the new product cycle with sharper execution and stronger organizational muscle. If the transition goes smoothly, Q3 could look very different. And for investors betting on execution during inflection points, this is the moment to watch. Since beginning volume production in late 2019, Li Auto has steadily built a portfolio of high-tech family EVsfrom the flagship Li MEGA MPV to the five- and six-seat L-series SUVs. Its one of the few players in China to successfully commercialize extended-range EVs while also building out full battery-electric platforms in parallel. While the Q2 miss isnt ideal, the long-term thesis might still hold: this is a company making bold bets on platform scale and product diversificationand taking its lumps now to set up a more competitive second half of 2025. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Insider
3 hours ago
- Business Insider
Benchmark Reaffirms Tesla (TSLA) Stock as ‘Top Pick,' Hikes Price Target on Robotaxi Optimism
Impressed with Tesla's (TSLA) robotaxi launch, Benchmark boosted the price target for the electric vehicle (EV) maker to $475 from $350 while maintaining a Buy rating. Also, Benchmark reaffirmed its 'Top Pick' status on TSLA stock, noting the 'successful launch' of the company's robotaxi service in Austin. The new price target indicates about a 46% upside potential from current levels and is based on a valuation of 53.9x 2028 EBITDA estimate, reflecting a premium to tech peers trading at 27.1x. Confident Investing Starts Here: TSLA stock is down more than 19% year-to-date due to concerns over weak demand amid intense competition and macroeconomic challenges. Benchmark Analyst Is Optimistic About Tesla's Robotaxi Benchmark analyst Michael Legg believes that while limited, Tesla's robotaxi launch in Austin reflected 'a controlled and safety-first approach.' The 4-star analyst added that impressing regulators and gaining a favorable public opinion are crucial, as they will enable the company to rapidly scale up its robotaxi service. Legg noted that new regulations for autonomous vehicles (AVs) are scheduled to take effect on September 1 in Texas, which he believes will further help win trust and drive expansion to additional cities. Legg contended that while Alphabet's (GOOGL) Waymo has a lead in the autonomous ride-hailing market, with operations in four cities and around 250,000 weekly rides, Tesla's approach is more scalable. He also pointed out the higher cost of Waymo's vehicles compared to Tesla's Model Y. The analyst highlighted that Tesla ended Q1 2025 with $37 billion in cash and generated over $600 million in free cash flow, which establishes that the EV maker has 'plenty of fresh powder' to invest in growth opportunities. Overall, Legg is bullish on Tesla's prospects and thinks that the Elon Musk-led company is 'undergoing an evolution from a trailblazing vehicle OEM [original equipment manufacturer] to a high-tech automation and robotics company with unmatched domestic manufacturing scale.' Expectations from Tesla's Q2 Deliveries Several Wall Street analysts have recently expressed concerns about Tesla missing Q2 deliveries expectations. However, Legg believes that the expected decline in TSLA's Q2 deliveries is priced into the stock. He added that a rebound is expected in the second half of 2025. Meanwhile, RBC Capital analyst Tom Narayan expects Tesla to deliver 366,000 vehicles in Q2, below the FactSet consensus of around 390,000 EVs. The 4-star analyst expects Q2 deliveries to increase sequentially due to the availability of the refreshed Model Y and plants operating at greater capacity. Narayan has a Buy rating on Tesla stock with a price target of $307. Is Tesla Stock a Buy or Sell? Wall Street has a Hold consensus rating on Tesla stock based on 14 Buys, 12 Holds, and nine Sell recommendations. The average TSLA stock price target of $291.31 indicates 10.6% downside risk from current levels.
