Tesla Is No Longer A Growth Stock Even Though It’s Valued Like One

Summary:

  • Intense competition will likely continue to erode Tesla, Inc.’s market position and already mediocre margins.
  • It does not have a core competency in battery production and it relies on third parties for this crucial component of an EV.
  • Its charging network is not a moat, and it can’t be a source of excess profits. It will likely only deliver a fair rate of return.
  • Even if the FSD Supervised updated software allows for faster AI Training and a robotaxi in August, Tesla is still 7-years behind the market leader, and it has nothing special to bring to the table. It likely won’t be a home run.
  • Despite the recent selloff, Tesla stock is still overpriced.

An electric car plugged in against a background of a rural location at sunset

Justin Paget/DigitalVision via Getty Images

Tesla, Inc. (NASDAQ:TSLA) recently reported disappointing vehicle delivery figures for Q1 2024. Not only did it badly miss the consensus of analyst estimates (449,000), but deliveries were also lower than the previous quarter. Some of

Q1 2023

Q4 2023

Q1 2024

422,875

484,507

386,810

Tesla, Inc

Toyota Motor Corp (TM)

Stellantis N.V. (STLA)

Porsche A.G. (OTCPK:DRPRY)

Mercedes-Benz A.G. (OTCPK:MBGAF)

BMW (OTCPK:BMWYY)

Market Cap

$525.17

$321.55

$103.19

$93.91

$83.83

$76.66

Tesla, Inc

Toyota Motor Corp

Stellantis N.V.

Porsche A.G.

Mercedes-Benz A.G.

BMW

Enterprise Value USD Billions1

$506.63

$471.16

$84.49

$93.35

$182.04

$167.80

Number of Employees1

140,473

375,235

258,275

40,694

166,056

154,950

Revenue per Employee1

688.91K

810.21K

1.10M

1.02M

1.11M

Tesla, Inc

Toyota Motor Corp

Stellantis N.V.

Porsche A.G.

Mercedes-Benz A.G.

BMW

Return on Shares YTD

-33.64%

31.28%

14.24%

15.45%

17.12%

9.35%

Return on Shares One Year

-11.11%

73.45%

65.25%

-20.07%

16.74%

22.54%

Return on Shares Three Years

-28.41%

65.41%

75.09%

25.80%

34.99%

Return on Shares Five Years

799.59%

123.12%

190.68%

107.17%

99.96%


Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.


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