STLA - Tesla Stock: Rich Valuation Faces Reality Check

2024-05-09 16:35:20 ET

Summary

• Tesla, Inc. has lost its first-mover advantage as competitors flood the market with new EVs.
• Tesla's rich valuation based on future growth in self-driving and robotics is unlikely to materialize, as these industries are already hyper-competitive.
• Insiders are selling shares, with no purchases in the last 3 years.
• Musk's pay package vote presents investors with two unattractive outcomes. Share dilution or a potential departure of Musk as CEO.

Investment Thesis

Tesla, Inc. (TSLA) has lost its first to market advantage and faces intense competitive pressure as Musk insists on his ~$50 billion pay package .

A slowdown in global EV sales and a stale product line has caused Tesla's Q1 2024 sales to drop 9% YoY . Tesla is now increasingly banking on autonomous driving, AI and robotics to justify its forward earnings multiple of 70. ...

For further details see: