Latest news with #TSLA
Yahoo
an hour ago
- Automotive
- Yahoo
Bad value? Fair value? Still a bargain? Up 43% in weeks, here's how I see Tesla stock today
It has been a roller-coaster ride for shareholders in Tesla (NASDAQ: TSLA). When? Take your pick! Tesla stock has soared 43% since late April alone. It is up 66% in a year and 413% in five years. But there have been some dizzying drops too. Even after its recent rise, the share price is a quarter below where it stood in December. Clearly, owning Tesla is not for the faint-hearted. But, as the share price has demonstrated over the long term, risks can sometimes come hand in hand with brilliant returns. So at its current price, could Tesla be a bargain for me to add to my portfolio? Only time will tell. A bargain is something that has been bought for less – ideally a lot less – than it turns out to be worth. There are two elements to that. One – what Tesla stock would cost me now – is crystal clear, not just to me but to everyone in the market. The second element – what it is actually worth – is far, far harder to gauge. Some shares actually trade for less than a sum of the parts. For example, Scottish Mortgage Investment Trust (itself a long-term Tesla shareholder) sells at a discount of around 10% to its net asset value. By contrast, at the end of the first quarter, Tesla's net asset value was well under 10% of its current market capitalisation. On that basis, the Tesla stock price certainly does not look like a bargain. However, that is only one way of valuing a company. A different approach than a hard, cold look at the balance sheet as it stands today is to consider what value those assets might help the company create for shareholders in future. I think it is fair to say this is how many investors have long valued Tesla stock. It has proven adept at growing sales and turning losses into profits over time. That is thanks to assets it still has, including its brand, proprietary technology, a vertically integrated manufacturing and marketing model, and some very talented employees. They could help propel the company even further in future. It has ambitions in high-potential, fast-growing business areas including artificial intelligence (AI) and robotics. It also has ambitions to expand into both trucks and self-driving taxis at a commercial scale. If it can do well enough even in just some of those areas, while performing solidly in its existing business, today's Tesla stock price may yet come to be seen as a bargain. However, while the potential reward part of that storyline attracts me, the actual risks do not. For one thing, a lot of the potential businesses are little more than that. Tesla has yet to prove it can roll them out at scale, let alone profitably. Meanwhile, the base business is struggling. Tesla's power generation unit has been performing strongly and has ongoing growth potential. But the car business saw sales fall slightly last year, while in the first quarter of this year, they slumped. In a highly competitive electric vehicle (EV) market, there is a risk of a permanent shift. Meanwhile, competition could squeeze profit margins. I do not think the current Tesla stock price adequately reflects such risks, so I will not be investing. The post Bad value? Fair value? Still a bargain? Up 43% in weeks, here's how I see Tesla stock today appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool C Ruane has no position in any of the shares mentioned. The Motley Fool UK has recommended Tesla. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 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
2 hours ago
- Automotive
- 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.
Business Insider
5 hours ago
- Automotive
- 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.
Business Insider
6 hours ago
- Automotive
- Business Insider
Tesla says first fully autonomous Model Y delivery completed ahead of schedule
Tesla (TSLA) CEO Elon Musk said in a post on X, formerly Twitter, 'The first fully autonomous delivery of a Tesla Model Y from factory to a customer home across town, including highways, was just completed a day ahead of schedule!!' Musk added in a subsequent post, 'There were no people in the car at all and no remote operators in control at any point. FULLY autonomous! To the best of our knowledge, this is the first fully autonomous drive with no people in the car or remotely operating the car on a public highway.' Confident Investing Starts Here:
Reuters
12 hours ago
- Automotive
- Reuters
Tesla completes first fully autonomous Model Y delivery ahead of schedule
June 27 (Reuters) - Tesla (TSLA.O), opens new tab CEO Elon Musk said on Friday that the first fully autonomous delivery of Model Y from the factory to a customer's home across town was completed a day ahead of schedule.
