Tesla, Inc.TSLANASDAQ
Loading

Executive Summary

Latest Data: Dec 2025
Consumer CyclicalAuto - Manufacturers
$1.4TMega Cap

A large-scale business, operating profitably, with revenues declining priced at a premium.

Key Investment Themes
Declining revenues (-3%)
Premium valuation (355.5x P/E)

Business Narrative

Tesla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. It operates in two segments, Automotive, and Energy Generation and Storage.

Consumer CyclicalAuto - Manufacturers
Mature & Stable
Revenue Mix
Single segment business
Bear Case
  • -Declining revenues signal potential market share erosion
  • -Premium valuation leaves limited margin of safety

Company at a Glance

Revenue Growth
-3%
Profit Margin
4%
Free Cash Flow
$6.2B
P/E Ratio
355.5x
+113% vs 5Y avg
ELEVATED

Business Performance

Business Scale
Revenue$94.8B
Net Income$3.8B
Profitability Quality
Gross Margin18%
Operating Margin5%
Net Margin4%
Growth Trajectory
Revenue Growth
-3%
EPS Growth
-47%
FCF Growth
74%

Key Highlights

Positive Signals

  • Free cash flow growing strongly, indicating quality earnings
  • Conservative balance sheet with low debt levels
  • Strong liquidity position with ample current assets

Watch Areas

  • Thin profit margins under 5%
  • Trading 113% above 5-year average valuation
  • Premium valuation requires continued strong execution

Financial Health

Liquidity
Strong
Current Ratio2.16
≥2.0 = Excellent
Cash & Equivalents$16.5B
Leverage
Strong
Debt / Equity0.10
<1.0 = Low leverage
Interest Coverage12.88x
≥5x = Comfortable
Efficiency
Concern
Return on Equity4.6%
<8% = Weak
Return on Capital3.0%
<8% = Weak

Valuation Assessment

Market Cap
$1.4T
Mega Cap
P/E (TTM)
355.5x
Elevated
vs 5Y avg: 167.2x (+113%)
P/S (TTM)
14.6x
Elevated
vs 5Y avg: 12.2x (+20%)
EV/EBITDA
117.3x
Elevated
vs 5Y avg: 78.4x
(+50%)
P/E Historical Range (5Y)
Min: 30.6xAvg: 167.2xNow: 355.5xMax: 383.0x
P/S Historical Range (5Y)
Min: 4.7xAvg: 12.2xNow: 14.6xMax: 19.4x
EV/EBITDA Historical Range (5Y)
Min: 21.2xAvg: 78.4xNow: 117.3xMax: 122.8x

Valuation Corridor

EXPENSIVE
FCF Yield
0.4%
vs Cost of Capital ~8.0% = Weak
P/E Corridor (5Y)355.5x
30.6xFair: 30.6x-307.7x383.0x
P/S Corridor (5Y)14.6x
4.7xFair: 6.4x-18.0x19.4x
EV/EBITDA Corridor (5Y)117.3x
21.2xFair: 37.1x-119.7x122.8x

Detailed Financials

Comprehensive financial statement data for deep analysis

MetricDec 21Dec 22Dec 23Dec 24Dec 25
Return on Equity
-
-
-
-
-
Return on Invested Capital
-
-
-
-
-
Gross Margin
25.3%
25.6%1.3%
18.2%28.7%
17.9%2.1%
18.0%0.9%
Operating Margin
12.1%
16.8%38.3%
9.2%45.2%
7.2%21.2%
4.6%36.6%
Net Margin
10.3%
15.4%50.5%
15.5%0.3%
7.3%52.9%
4.0%45.2%
Earnings Yield
-
-
-
-
-
Page 1 of 2