| Snowflake Score | |
|---|---|
| Valuation | 0/6 |
| Future Growth | 6/6 |
| Past Performance | 6/6 |
| Financial Health | 6/6 |
| Dividends | 0/6 |
TSLA Stock Overview
Tesla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally.
Tesla Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$695.20 |
| 52 Week High | US$1,243.49 |
| 52 Week Low | US$620.46 |
| Beta | 2.13 |
| 1 Month Change | -2.75% |
| 3 Month Change | -34.25% |
| 1 Year Change | 7.84% |
| 3 Year Change | 1,354.88% |
| 5 Year Change | 954.87% |
| Change since IPO | 14,450.02% |
Recent News & Updates
Tesla: 10-K Footnotes And Bears' Arguments
My favorite Charles Munger quote is not to comment on a topic until I can argue against myself better than the people on the other side. Human nature just loves confirmatory evidence. But in investing, especially investing in nonlinear stocks like Tesla, it is more important to look for disconfirming information. Here, I will argue against my own bull thesis and address some potential risks for Tesla that are not often discussed. The goal is not to dismiss these concerns (they are 100% valid), but to provide a full view so both bears and bulls can all make better investment decisions. Thesis I have been a long-term bull on Tesla (TSLA) as you can see from my previous writings. I have published a series of articles arguing for its nonlinear growth potential. In this article, I will switch perspective and address the bears’ counterargument. The point is not to prove them to be wrong. Quite the opposite, their concerns are 100% valid to me. I am analyzing these concerns not to dismiss their concerns, but to provide a full view, so we can all make an informed decision. An open mind that can work with conflicting views is the starting point for investing, especially for nonlinear stocks like TSLA. And this has been a cornerstone of my own investing philosophy. And it is also a philosophy that my writing and market service always promote. We always value disconfirming information more than confirming information. Charlie Munger was once asked for tips for investors who have to work with two opposing views. And his response quoted below, as usual, is so quotable: Charlie Munger: Well, I do have a tip. At times in my life, I have put myself to a standard that I think has helped me: I think I’m not really equipped to comment on this subject until I can state the arguments against my conclusion better than the people on the other side. If you do that all the time; if you’re looking for disconfirming evidence and putting yourself on a grill, that’s a good way to help remove ignorance. Following this wisdom, let’s play the game of arguing against ourselves. Many of you probably are familiar with the common bears’ view already such as high valuation, competition, carbon credit, et al. So, this article will limit the scope to two concerns (scale of government subsidies and tax incentives) not often discussed, concerns that have to be gleaned mostly from the footnotes or independent disclosures. Government Subsidies First, TSLA’s current financials are dressed up by a multitude of government aids, both from local state, federal, and also overseas. Musk is very vocal against government aid and if you follow his Twitter, you may form the wrong view that TSLA does not benefit from such aid. On the contrary, TSLA benefits extensively from these aids. And given how fickly government policies can change, such aids form a considerable uncertainty for TSLA’s long-term prospects. Take U.S. aid as an example. These aids include federal loans, tax breaks, loan guarantees, bailout assistance, State/Local loans, bond financing, and venture capital. You can see a detailed list of these aids at this link. As of this writing, TSLA receives a total of 110 subsidies with a total face value of more than $2.5B. To put things into perspective, TSLA's 2021 total net income was only $5.6B. These subsidies are not limited to the US alone. They come from overseas markets like Europe and China too, adding a further layer of uncertainties, as elaborated below. Source: Subsidytracker.goodjobsfirst.org Tax Incentives The following chart shows TSLA’s most recent income statement. The taxes are highlighted. And as you can see, it earned $3.6B of pretax income in the quarter ended on March 31, 2022, and reported a provision for income tax of $346M. So this leads to an effective rate of less than 10% (9.6% to be precise). The picture of last year was very similar: $69M of tax provision on a $533M pretax earnings. The reasons for such low tax rates, as indicated in its Form 10-K, are several temporary tax incentives. For example, China has approved a tax reduction for TSLA from the normal rate of 25% to 15%. The reason for singling out China here is twofold.
Tesla: What's The Outlook After Announced 3-For-1 Stock Split?
Tesla is planning another stock split after completing its last split as recently as 2020. The split will make options more accessible to retail traders, but is otherwise a non-event. Regardless of the split, Tesla remains a high uncertainty stock but is probably trading near fair value today.
Tesla: Incentives Matter
Legacy automakers are incentivized to manufacture ICE vehicles, so they can sell parts after warranties expire. Legacy dealers make much of their gross profit on parts and service, so they're motivated to continue pushing ICE vehicles over EVs. CEO Musk aims to make Tesla compelling by winning on electrification and autonomy.
Shareholder Returns
| TSLA | US Auto | US Market | |
|---|---|---|---|
| 7D | 1.4% | 0.8% | 0.7% |
| 1Y | 7.8% | -7.8% | -18.4% |
Return vs Industry: TSLA exceeded the US Auto industry which returned -9.4% over the past year.
Return vs Market: TSLA exceeded the US Market which returned -18.4% over the past year.
Price Volatility
| TSLA volatility | |
|---|---|
| TSLA Average Weekly Movement | 10.6% |
| Auto Industry Average Movement | 13.4% |
| Market Average Movement | 8.2% |
| 10% most volatile stocks in US Market | 16.9% |
| 10% least volatile stocks in US Market | 3.4% |
Stable Share Price: TSLA is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 11% a week.
Volatility Over Time: TSLA's weekly volatility (11%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 2003 | 99,290 | Elon Musk | https://www.tesla.com |
Tesla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. The company operates in two segments, Automotive, and Energy Generation and Storage. The Automotive segment offers electric vehicles, as well as sells automotive regulatory credits.
Tesla Fundamentals Summary
| TSLA fundamental statistics | |
|---|---|
| Market Cap | US$720.50b |
| Earnings (TTM) | US$8.40b |
| Revenue (TTM) | US$62.19b |
85.7x
P/E Ratio11.6x
P/S RatioIs TSLA overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| TSLA income statement (TTM) | |
|---|---|
| Revenue | US$62.19b |
| Cost of Revenue | US$45.34b |
| Gross Profit | US$16.85b |
| Other Expenses | US$8.45b |
| Earnings | US$8.40b |
Last Reported Earnings
Mar 31, 2022
Next Earnings Date
Jul 20, 2022
| Earnings per share (EPS) | 8.11 |
| Gross Margin | 27.10% |
| Net Profit Margin | 13.51% |
| Debt/Equity Ratio | 9.7% |
How did TSLA perform over the long term?
See historical performance and comparisonValuation
Is TSLA undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score
0/6Valuation Score 0/6
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio
Key Valuation Metric
Which metric is best to use when looking at relative valuation for TSLA?
Other financial metrics that can be useful for relative valuation.
| What is TSLA's n/a Ratio? | |
|---|---|
| n/a Ratio | 0x |
| n/a | n/a |
| Market Cap | US$720.50b |
| Key Statistics | |
|---|---|
| Enterprise Value/Revenue | 11.4x |
| Enterprise Value/EBITDA | 56x |
| PEG Ratio | 3.5x |
Price to Earnings Ratio vs Peers
How does TSLA's PE Ratio compare to its peers?
| TSLA PE Ratio vs Peers |
|---|
| Company | PE | Estimated Growth | Market Cap |
|---|---|---|---|
| Peer Average | 6.9x | ||
GM General Motors | 5.2x | 5.7% | US$45.6b |
600104 SAIC Motor | 8.5x | 12.4% | CN¥197.3b |
7203 Toyota Motor | 9.9x | 5.8% | JP¥28.2t |
F Ford Motor | 3.8x | 16.5% | US$45.0b |
TSLA Tesla | 85.7x | 24.7% | US$720.5b |
Price-To-Earnings vs Peers: TSLA is expensive based on its Price-To-Earnings Ratio (85.7x) compared to the peer average (6.9x).
Price to Earnings Ratio vs Industry
How does TSLA's PE Ratio compare vs other companies in the Global Auto Industry?
Price-To-Earnings vs Industry: TSLA is expensive based on its Price-To-Earnings Ratio (85.7x) compared to the US Auto industry average (8.1x)
Price to Earnings Ratio vs Fair Ratio
What is TSLA's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
| Fair Ratio | |
|---|---|
| Current PE Ratio | 85.7x |
| Fair PE Ratio | 25.3x |
Price-To-Earnings vs Fair Ratio: TSLA is expensive based on its Price-To-Earnings Ratio (85.7x) compared to the estimated Fair Price-To-Earnings Ratio (25.3x).
Share Price vs Fair Value
What is the Fair Price of TSLA when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: TSLA ($695.2) is trading above our estimate of fair value ($419.54)
Significantly Below Fair Value: TSLA is trading above our estimate of fair value.
Price to Earnings Growth Ratio
PEG Ratio: TSLA is poor value based on its PEG Ratio (3.5x)
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Future Growth
How is Tesla forecast to perform in the next 1 to 3 years based on estimates from 34 analysts?
Future Growth Score
6/6Future Growth Score 6/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE
24.7%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: TSLA's forecast earnings growth (24.7% per year) is above the savings rate (1.9%).
Earnings vs Market: TSLA's earnings (24.7% per year) are forecast to grow faster than the US market (13% per year).
High Growth Earnings: TSLA's earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: TSLA's revenue (20.8% per year) is forecast to grow faster than the US market (7.9% per year).
High Growth Revenue: TSLA's revenue (20.8% per year) is forecast to grow faster than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: TSLA's Return on Equity is forecast to be high in 3 years time (28.7%)
Discover growth companies
Past Performance
How has Tesla performed over the past 5 years?
Past Performance Score
6/6Past Performance Score 6/6
Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE
76.1%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: TSLA has high quality earnings.
Growing Profit Margin: TSLA's current net profit margins (13.5%) are higher than last year (3.1%).
Past Earnings Growth Analysis
Earnings Trend: TSLA has become profitable over the past 5 years, growing earnings by 76.1% per year.
Accelerating Growth: TSLA's earnings growth over the past year (655.8%) exceeds its 5-year average (76.1% per year).
Earnings vs Industry: TSLA earnings growth over the past year (655.8%) exceeded the Auto industry 81%.
Return on Equity
High ROE: TSLA's Return on Equity (23.9%) is considered high.
Discover strong past performing companies
Financial Health
How is Tesla's financial position?
Financial Health Score
6/6Financial Health Score 6/6
Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage
Financial Position Analysis
Short Term Liabilities: TSLA's short term assets ($29.1B) exceed its short term liabilities ($21.5B).
Long Term Liabilities: TSLA's short term assets ($29.1B) exceed its long term liabilities ($9.2B).
Debt to Equity History and Analysis
Debt Level: TSLA has more cash than its total debt.
Reducing Debt: TSLA's debt to equity ratio has reduced from 133.9% to 9.7% over the past 5 years.
Debt Coverage: TSLA's debt is well covered by operating cash flow (404.9%).
Interest Coverage: TSLA's interest payments on its debt are well covered by EBIT (39.2x coverage).
Balance Sheet
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Dividend
What is Tesla current dividend yield, its reliability and sustainability?
Dividend Score
0/6Dividend Score 0/6
Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage
Dividend Yield vs Market
Notable Dividend: Unable to evaluate TSLA's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.
High Dividend: Unable to evaluate TSLA's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if TSLA's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if TSLA's dividend payments have been increasing.
Earnings Payout to Shareholders
Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: Unable to calculate sustainability of dividends as TSLA has not reported any payouts.
Discover strong dividend paying companies
Management
How experienced are the management team and are they aligned to shareholders interests?
3.8yrs
Average management tenure
CEO
Elon Musk (50 yo)
13.75yrs
Tenure
Mr. Elon R. Musk is a Co-Founder of Tesla, Inc. and serves as its Chief Executive Officer since October 2008 and Director since April 2004 and is Technoking of Tesla. Mr. Musk is the Chief Executive Office...
CEO Compensation Analysis
Compensation vs Market: Insufficient data to establish whether Elon's total compensation is reasonable compared to companies of similar size in the US market.
Compensation vs Earnings: Elon's compensation has been consistent with company performance over the past year.
Leadership Team
Experienced Management: TSLA's management team is considered experienced (3.8 years average tenure).
Board Members
Experienced Board: TSLA's board of directors are considered experienced (6.5 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: TSLA insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.6%.
Top Shareholders
Company Information
Tesla, Inc.'s employee growth, exchange listings and data sources
Key Information
- Name: Tesla, Inc.
- Ticker: TSLA
- Exchange: NasdaqGS
- Founded: 2003
- Industry: Automobile Manufacturers
- Sector: Automobiles
- Implied Market Cap: US$720.499b
- Shares outstanding: 1.04b
- Website: https://www.tesla.com
Number of Employees
Location
- Tesla, Inc.
- 13101 Tesla Road
- Austin
- Texas
- 78725
- United States
Listings
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2022/07/06 00:00 |
| End of Day Share Price | 2022/07/06 00:00 |
| Earnings | 2022/03/31 |
| Annual Earnings | 2021/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.