Is Tesla (TSLA) Fairly Priced After Recent Volatility? A Closer Look at Its Valuation Narrative

Tesla (TSLA) has had a choppy few weeks, with the stock slipping about 8% over the past month but still up roughly 27% in the past 3 months. This has kept investors focused on valuation.

See our latest analysis for Tesla.

Stepping back, Tesla’s 13.17% year to date share price return and a 19.92% one year total shareholder return suggest that, despite the recent pullback from the 429.24 dollar share price, longer term momentum is still broadly intact as the market reassesses growth versus execution risk.

If Tesla’s volatility has you rethinking concentration risk, this could be a good moment to scan other auto innovators and compare their trajectories using our auto manufacturers.

With growth still outpacing many legacy automakers but the share price now sitting above the average analyst target, the key debate is clear: Is Tesla undervalued on its long term potential, or is future growth already fully priced in?

Most Popular Narrative Narrative: 1% Overvalued

Tesla’s last close around 429 dollars sits slightly above the 425 dollar fair value outlined in the most followed narrative, setting up a finely balanced outlook.

Robo Taxi Monetization: gradual deployment and scaling of robotaxis, contributing to high margin, recurring revenue. FSD Licensing: Tesla monetizing self driving technology by licensing FSD to other automakers.

Read the complete narrative.

Want to see what happens when aggressive earnings growth, expanding margins, and a premium future multiple all collide in one model? The narrative’s numbers might surprise you.

Result: Fair Value of $425.37 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, significant delays in FSD approvals or intensified Chinese EV competition could quickly challenge the bullish AI and robotaxi driven narrative around Tesla.

Find out about the key risks to this Tesla narrative.

Build Your Own Tesla Narrative

If this storyline does not quite match your own view, you can quickly dive into the numbers and shape a custom thesis in minutes, Do it your way.

A great starting point for your Tesla research is our analysis highlighting 1 key reward and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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