- Investors, analysts and the general public seem deeply unimpressed with Tesla’s robotaxi event earlier this week.
- Tesla’s stock closed down 8% on Friday, when it was supposed to be a propulsive event for the company.
- CEO Elon Musk has vowed to make Tesla into an AI and robotics powerhouse, but proof of this plan feels in short supply.
Here’s their all time stock price graph. Not exactly a death spiral, though that 3y performance number makes it sound so. The 1, 2, and 5 year numbers don’t tell the same story. You might even say it was a bit of a cherry pick.
Disclaimer: I own no TSLA shares. I just know how to manipulate stats for effect, so I know when it’s being done to me :)
Regardless of it’s performance, it’s astronomically overvalued. Tesla’s market cap is larger than 5 of the nearest rivals combined. The value of their shares doesn’t reflect reality.
But reality inevitably catches up. Their last quarterlies were not looking good. The market is saturated with EVs now and Tesla is going to struggle to attract new customers, especially with the divisive politics of Elon Musk. About the only reason Tesla is still dominant in North America is because they are still the cheapest in town, but that is reflected in the shoddy build quality and bare bones interior.
It is hugely overvalued. We should scoff at their crazy highs instead of penalizing them for being below them. You can’t necessarily be blamed because at certain points investors wildly overvalued you. A lot of times the stock market punishes success. My employer for example doubled its business during COVID and when that spike eventually cooled off we were still on a good growth trajectory but a couple of quarters came in at negative YoY revenue and of course everyone lost their minds. This is why I always look at the zoomed out graph. It’s so easy to miss the real story looking at any one slice of it.
Still doesn’t look good for a company to lose 50% on its all time high
True, that’s never what you want over the long haul.