Tesla, Inc. (TSLA): what the price requires
At today's price, Tesla, Inc. (TSLA) is priced for today's economics sustained for ~38.6 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-13 · Source: https://boothcheck.com/report/TSLA
Headline
| Field | Value |
|---|---|
| Ticker | TSLA |
| Company | Tesla, Inc. |
| Sector / Industry | Consumer Cyclical / Auto Manufacturers |
| Current price | $393.67/sh |
| Composition | Automotive sales 69% / Automotive regulatory credits 2% / Energy generation and storage sales 13% / Services and other 13% / Automotive leasing 2% / Energy generation and storage leasing 1% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin today | 4.2% |
| Must persist for | 38.6y |
| Multiple paid | 380x operating income |
Solve inputs: computed at a 13% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~4.3 years.
Reconcile: at the x-ray's 9.3% required return this reads ~24.9 years; the models below use their own rates.
How unusual the bet is: extreme
| Reference | Value |
|---|---|
| vs own history | -0.16σ |
| sustained it ~10 years at this level | 14% |
| implied end-window share | 265% |
Valuation X-Ray
Every valuation family lands below the price. The price therefore requires assumptions beyond what those standard frames encode.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 14.34x | 1 | expensive |
| Earnings | 18.18x | 1 | expensive |
| Relative | 9.49x | 3 | expensive |
| Growth | 3.14x | 3 | expensive |
Families that call it expensive: Asset, Earnings, Relative, Growth
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.2%); the inversion above states its own rate.
Per-Model Detail (n=8)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $25.91 | 15.19x | yes | FCF base $7.0B, growth 3% (input: historical growth), terminal g 3.1%, WACC 9.2%, 5yr projection |
| DCF Exit Multiple | Growth | $230.51 | 1.71x | yes | Exit EV/EBITDA: 135.6x / 137.6x / 139.6x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $72.92 | 5.40x | yes | P/E 44x (blended: sector 20x + trailing (TTM) 280x), scenarios: 37.0x / 44.0x / 51.0x (bear / base = sector held flat / bull), EV/EBITDA 28.6x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $15.22 | 25.87x | yes | BV/sh $23.78, ROE (TTM) 5.9%, ke 9.3% (excluded from median) |
| Two-Stage Excess Return | Asset | $11.83 | 33.28x | yes | 5yr excess ROE then converge to ke=9.3% (excluded from median) |
| Discounted Future Market Cap | Growth | $125.34 | 3.14x | yes | Rev $97.9B, growth 3% (input: historical growth; tapered), Terminal P/S: 6.7x / 8.0x / 9.3x (bear / base = today's held flat / bull, cap 8x) |
| Growth-Adjusted P/E | Relative | — | — | no | — |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $13.43 | 29.31x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $8.27B × (1−34%) / WACC 9.2% → EPV (no growth) (excluded from median) |
| Residual Income | Asset | $11.40 | 34.53x | yes | BV $23.78 + 5yr PV of (ROE (TTM) 5.9% − Kₑ 9.3%) × BV; BV grows 3.8%/yr (excluded from median) |
| Graham Number | Asset | $27.45 | 14.34x | yes | √(22.5 × EPS $1.41 × BVPS $23.78) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $37.43 | 10.52x | yes | EBITDA $10.12B × sector EV/EBITDA 13.0x |
| FCF Yield | Earnings | $21.65 | 18.18x | yes | FCF $7000.0M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $11.62 | 33.88x | yes | SBC-adj FCF $3.72B (FCF $7.00B − SBC $3.28B) capitalized at Kₑ (excluded from median) |
| Ben Graham Formula | Earnings | $1.18 | 333.62x | yes | EPS $1.41 × (8.5 + 2×-5.0%) × (4.4 / 5.3%) (excluded from median) |
| ROIC-Justified P/B | Asset | $1.93 | 203.97x | yes | BV $23.78 × (ROIC 0.7% / WACC 9.2%) (excluded from median) |
| P/Sales Sector | Relative | $41.50 | 9.49x | yes | Revenue $97.88B × sector P/S 1.5x |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | $15.23 | 25.85x | yes | EPS $1.41 / required return 9.3% (Rf 4.3% + ERP 5.0%) (excluded from median) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Build Of Price (Sum Of The Parts)
The price decomposes into a demonstrated fundamentals base plus a segment premium. Each segment is an additive contributor to the premium at peer-cohort economics, not an independent defender of an allocated target.
| Component | Per share |
|---|---|
| Fundamentals base | $41.39 |
| Forward-optionality premium | $352.28 |
| = Current price | $393.67 |
Discount rate: 10.0% cost of equity.
Core Pieces (The Demonstrated Base, By Reportable Segment)
| Core piece | Revenue | Trend | Margin | Floor/sh | Own optionality/sh |
|---|---|---|---|---|---|
| Automotive | $82.1b | — | 16% | $22.68 | — |
| Energy generation and storage | $12.8b | — | 30% | $18.71 | — |
Floor shares sum to the base. Each piece carries its own forward optionality on top of its demonstrated value; these draw on the same premium the named bets below also draw on, not a separate pool.
Named Segments (Standalone Central Values)
| Segment | Category | Central value/sh | Scenario range/sh | Strategic floor/sh | Peer cohort |
|---|---|---|---|---|---|
| FSD subscription + licensing | software-platform | $245.56 | $38.22 – $1582.96 | — | MSFT, ADBE, CRM, MBLY |
| Robo-taxi fleet | transport-rideshare | $215.96 | $33.62 – $1392.18 | — | UBER, LYFT, GOOGL |
| Optimus humanoid robot | industrial-oem | $87.98 | $13.70 – $567.18 | — | ABB, FANUY, ROK, ISRG |
The standalone values sum to $549.50, more than the $352.28 premium: the market discounts the segments' standalone sum by 36%. The over-sum is the signal that the segments were never the premium's sole burden; the core carries its own optionality besides.
At central scale the combined named-segment contribution spans $341.19 – $884.98 as timing varies (an honest range, not a point).
Solvency
| Field | Value |
|---|---|
| Net cash | $35.5b |
| Net debt / NOPAT (after-tax) | -13.92x (net cash) |
| Net debt / operating income (pre-tax) | -9.14x (net cash) |
| Interest coverage | 11.3x |
| Share count CAGR (dilution) | 0.5% |
| Burning cash | no |
Bullet Takeaways
- Tesla is priced as three companies stacked on one: a car maker generating $82.1 billion of automotive and services revenue, a fast-growing energy business that grew to $12.8 billion in FY2025 (up 27 percent), and a set of autonomy and robotics bets, FSD, robotaxi, and Optimus, that carry most of the market value.
- The near-term story is a demand recovery: Q2 2026 deliveries reached 480,126 vehicles, up about 25 percent year over year, while the robotaxi service expanded to Miami as Tesla's first driverless deployment without an in-car safety monitor.
- The next scheduled event is the Q2 earnings call on July 22, 2026, where automotive gross margin excluding credits, Cybercab progress, and Optimus factory preparation are the items that move the thesis more than the delivery number already known.
Bull Case
The right way to read Tesla is not as a car company that trades expensively, but as a bundle of businesses at very different stages, and the fastest-growing one is no longer the cars. Energy generation and storage revenue grew to $12.77 billion in fiscal 2025, up 27 percent, per the 10-K's segment table (accession 0001628280-26-003952), and it grew at higher margins than the auto business: an earlier 2025 quarterly filing shows energy gross margin reaching 28.8 percent as "a higher proportion of our storage business, which operated at a higher gross margin" mixed into the segment (accession 0001628280-25-018911). Megapack, the utility-scale product, is sold out through 2026 with backlog into 2027, and Q2 2026 storage deployments hit 13.5 GWh, up 40 percent year over year. This is a real, scaling, high-margin infrastructure business that the auto multiple obscures, and it belongs in the energy peer cohort, not the automaker one.
The autonomy layer is where the price actually lives, and it stopped being a promise this year. Tesla launched its robotaxi service in June 2025, which the 10-K confirms as "our Robotaxi service, an autonomous ride-hailing p"latform (accession 0001628280-26-003952), and by mid-2026 it had expanded from Austin to the San Francisco Bay Area, Dallas, Houston, and now Miami, the last being the first deployment carrying passengers with no in-car safety monitor. The subscription software business grew underneath it: active FSD subscriptions reached about 1.28 million, up roughly 51 percent year over year, after the company moved FSD to subscription-only. In the sum-of-parts decomposition, FSD subscription and licensing carries a standalone central value near $256 per share and the robotaxi fleet near $225, routed to enterprise-software and rideshare peer cohorts respectively; both are now producing observable commercial traction rather than slideware.
Then there is Optimus, the piece with no public comparable and the largest ambition. The 10-K is candid that this is "a nascent industry that has yet to develop commercially" and that "there is no guarantee this business will be successful" (accession 0001628280-26-003952), so honesty requires naming that its roughly $92 per share standalone value is benchmarked against industrial-robotics and precision-surgical adjacencies, not a direct peer. But the bull case for the humanoid is a labor-substitution market measured in the trillions, and Tesla is preparing first large-scale factory lines this year. Underneath all three bets sits a balance sheet that removes the usual speculative-growth risk: net cash, a current ratio of 2.0, and four straight quarters of positive free cash flow totaling $7.0 billion. Tesla can fund the entire optionality stack from its own cash flow, which is why the market lets it run the experiments in public.
Bear Case
The bear case starts where the moat is thinnest: the car business that pays the bills is being commoditized, and the premium the price assumes rests on the parts that have not been commercialized. On the demonstrated economics, Tesla is a car maker earning a 4.2 percent operating margin in its most recent quarter, with net margin compressed to 2.1 percent and net income actually down as pricing pressure bit. The 10-K does not hide the direction: total automotive revenue fell to $69.5 billion in the core auto line, and regulatory-credit revenue, near-pure profit, dropped to $1.99 billion from $2.76 billion, a 28 percent decline the filing attributes to changing regulation and "the demand for credits by other automobile manufacturers" (accession 0001628280-26-003952). As rivals build their own compliant EVs, that free profit stream shrinks, and it shrinks fastest exactly when Tesla needs earnings to defend the multiple. The 10-K states plainly the market "is highly competitive today and we expect it will become even more so in the future" as established and new manufacturers enter EVs and self-driving alike.
The autonomy premium faces an erosion problem of a different kind: competitors reaching commercial autonomy first, at higher demonstrated technical maturity. Waymo already runs driverless commercial service at scale in multiple cities, and the graveyard behind Tesla's robotaxi ambition is instructive, Cruise shut down in 2024 and Argo AI in 2022, meaning no operator has yet achieved autonomous-rideshare economics at meaningful scale. Tesla's robotaxi is expanding, but from a small footprint, and the FSD execution record includes NHTSA recall history and documented intersection-handling failures in the 2025 beta. The bet embedded in the price is not just that Tesla succeeds; it is that Tesla out-executes better-funded, further-along autonomy programs in a business where the two prior well-capitalized entrants failed outright.
Now connect it to what the price requires. This is a stock no valuation family reaches: asset-based, relative-multiple, and even forward-growth methods all land far below the price, and the trailing multiples, 328 times earnings, 142 times EBITDA, are not the argument so much as the symptom. The inversion isolates the energy segment as carrying the priced-in premium, and the number is stark: the price implies energy operating growth held at its self-funding ceiling for about 39 years, a persistence only about 14 percent of comparable fast-growers sustained for even ten. Reading the build of price, roughly $41 per share reflects the established operations on demonstrated economics, and about $366 is forward optionality the market pays across the core and the named bets. The named speculative segments' standalone values actually over-sum that premium by about 36 percent, which means the market is already discounting them, but the premium is still nine-tenths of the stock. Every dollar of that $366 depends on FSD, robotaxi, and Optimus converting from pilots into profit pools on a timeline no one can date, while the car business that funds the wait keeps losing pricing power and credit income. If autonomy arrives late, or arrives to a competitor, the demonstrated $41 is what remains.
Valuation
The only honest way to read Tesla's price is to take it apart, because a single company-wide multiple on a business this heterogeneous is a category error. At $407.43 (July 2026), the price builds up as roughly $41 per share from the established, cash-generating operations on their demonstrated economics, plus a premium of about $366 per share. That premium is the forward optionality the market is paying, and it is carried across the whole company, the mature core carries its own share of it, not a bill the named autonomy segments alone must settle. Nine-tenths of the stock, then, is a claim on things Tesla has not yet turned into steady profit.
The inversion points to where the most demanding assumption sits. Isolating the segment that carries the priced-in premium, the model reads the price as implying energy generation and storage operating growth held at its self-funding ceiling for about 39 years, a persistence only about 14 percent of comparable fast-growers have sustained for even ten. That is an elevated read, and it is worth stating with its label: this is an interpretation of what the price assumes, not a claim about what will happen. Separately, the valuation X-ray finds no method family reaching the price at all, asset-based, relative-multiple, and forward-growth methods all land well below it, so the price is a bet beyond what any standard frame supports. Two trailing operating-income bases appear in the inputs, the inversion record's $3.9 billion and the EDGAR TTM $4.9 billion, about 21 percent apart; they are different measurement bases and neither is a fair value.
The named speculative pieces make the decomposition concrete. FSD subscription and licensing carries a standalone central value near $256 per share, routed to the enterprise-software cohort (peers like Oracle, Salesforce, Adobe) with Mobileye as an autonomy reference; the robotaxi fleet near $225, routed to the thin rideshare cohort of Uber and Lyft with Waymo as a proxy; and Optimus near $92, which must carry an explicit caveat, no public humanoid-robotics peer exists, so its multiple is an adjacent benchmark drawn from industrial-robotics and precision-surgical names, not a direct comp. Those three standalone values sum to about $572 per share, more than the $366 premium, so the market is discounting the segments' standalone sum by roughly 36 percent; the over-sum is the signal that the segments were never the premium's sole burden. Across the pieces, the combined named-segment contribution spans roughly $355 to $921 per share as maturity timing varies, sooner delivery worth more, later worth less. What would have to be true to earn the premium is not one milestone but a chain across the core and the bets: energy compounding at rates history rarely delivers, FSD monetizing at software-like margins, robotaxi reaching commercial scale no operator has yet achieved, and Optimus creating an economic use case in an industry that has none. The balance sheet is the one unambiguous positive, net cash, positive free cash flow, no solvency clock, so the question is never survival; it is whether the optionality converts before the demonstrated core, currently a 4.2 percent-operating-margin car business shedding credit revenue, is repriced to what it actually earns.
Catalysts
The delivery number is already out and the earnings report is the next real event. Tesla delivered 480,126 vehicles in Q2 2026, up about 25 percent year over year and 34 percent sequentially, comfortably above the Wall Street bar near 406,000, yet the stock reaction was muted because the market is now trading margins and autonomy rather than unit counts. The Q2 2026 earnings call is confirmed for July 22, 2026 after the close, and the single most-watched line is automotive gross margin excluding regulatory credits, with the debate centered on whether it holds in the roughly 18 to 20 percent range. Cybercab ramp progress and the financial impact of the roughly $25 billion capital expenditure plan are the other items that matter more than deliveries.
Autonomy is moving on a visible cadence. The robotaxi service, launched in Austin in June 2025, expanded through the Bay Area, Dallas, and Houston, and reached Miami in mid-2026 as the first deployment without an in-car safety monitor. FSD subscriptions grew to about 1.28 million from roughly 850,000 a year earlier after the shift to subscription-only. Cybercab, the purpose-built autonomous vehicle without pedals or a steering wheel, is set to ramp later in 2026, which would tie the robotaxi ambition to dedicated hardware rather than retrofitted consumer cars.
Two longer-dated threads round out the calendar. Energy storage deployed 13.5 GWh in Q2, its second-largest quarter ever, with Megapack sold out through 2026 and Megapack 3 on schedule for volume production this year. And Optimus is entering its factory-preparation phase, with first-generation lines being readied at Fremont and next-generation capacity planned at Gigafactory Texas, the earliest-stage and highest-variance of the bets. Analyst targets have widened around all of this: the street average sits near $421, with Stifel at $508 and TD Cowen at $490, a spread that itself reflects how much of the value rides on unproven segments.
Peer Cohorts (Per Segment, With Filing Citations)
Automotive (reported)
- F (Ford Motor Co)
- (no filing in the citation store)
- GM (GENERAL MOTORS COMPANY)
- (no filing in the citation store)
- STLA (Stellantis NV)
- (no filing in the citation store)
- RIVN (Rivian Automotive, Inc. / DE)
- (no filing in the citation store)
- LCID (Lucid Group, Inc.)
- (no filing in the citation store)
Energy generation and storage (reported)
- ENPH (Enphase Energy Inc)
- (no filing in the citation store)
- FSLR (First Solar Inc)
- (no filing in the citation store)
- SEDG (SolarEdge Technologies Inc)
- (no filing in the citation store)
- RUN (Sunrun Inc)
- (no filing in the citation store)
- NEE (NextEra Energy Inc)
- (no filing in the citation store)
- FLNC (Fluence Energy Inc)
- (no filing in the citation store)
- NXT (Nextracker Inc)
- (no filing in the citation store)
- BE (Bloom Energy Corp)
- (no filing in the citation store)
FSD subscription + licensing (speculative)
- MSFT (MICROSOFT CORPORATION)
- (no filing in the citation store)
- ADBE (ADOBE INC.)
- (no filing in the citation store)
- CRM (Salesforce, Inc.)
- (no filing in the citation store)
- MBLY (Mobileye Global Inc.)
- (no filing in the citation store)
Robo-taxi fleet (speculative)
- UBER (UBER TECHNOLOGIES, INC.)
- (no filing in the citation store)
- LYFT (Lyft, Inc.)
- (no filing in the citation store)
- GOOGL (ALPHABET INC.)
- (no filing in the citation store)
Optimus humanoid robot (speculative)
- ABB (ABB Ltd)
- (no filing in the citation store)
- FANUY (Fanuc Corp)
- (no filing in the citation store)
- ROK (Rockwell Automation, Inc.)
- (no filing in the citation store)
- ISRG (Intuitive Surgical, Inc.)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Build of price (SOTP): the price is decomposed into a demonstrated fundamentals base plus a segment premium. Per-segment contributions are computed under peer-cohort category economics. Segments are additive contributors; no per-segment allocated target is imposed.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
FY2025 10-K, accession 0001628280-26-003952 · Q2 2026 delivery release; company robotaxi announcement · pv magazine; ess-news · robotaxi announcements via BigGo · TradingView; company · company; LinkedIn · Q2 2026 delivery release; Eastern Herald · Basenor; MEXC preview · BigGo; robotaxi announcements · TradingView · 24/7 Wall St.; Yahoo Finance