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Tesla (NASDAQ: TSLA) is sporting a market capitalization of $888 billion as I write this. That's big! And that's after a year-to-date drop of 38%. The shares have been dropping recently for multiple reasons -- such as vehicle quality issues (including a recall of all Cybertrucks) and CEO Elon Musk's controversial actions in the U.S. government.
Tesla may do well from here on out, but its brand and reputation have taken a hit that might last a while. I think there's a chance the stock won't grow much over the next decade. Here are three stocks I think will have bigger market caps than Tesla in a decade.
1. BYD
BYD (OTC: BYDDY) has long been a rival of Tesla's, and recent news reports suggest that it's winning. It's a Chinese company specializing in clean energy vehicles and related products, and none other than famed investor Warren Buffett is an investor in the company.
BYD recently posted a great fourth-quarter earnings report, with record revenue of $107 billion for the 2024 year, outpacing Tesla's $98 billion. The carmaker delivered 4.25 million vehicles last year, nearly as many as Ford Motor Company. Even more impressive, BYD's Super E-Platform can reportedly charge an electric car in just 5 minutes, giving it about 250 miles of range.
BYD's market value was recently $162 billion. With revenue up 29% year over year in 2024, let's assume that its market value keeps growing over the coming decade at just 20%. If so, it will end up worth about $1 trillion, well above Tesla's current value. If the market value grows at 25% over a decade, it will end up near $1.5 trillion.
2. Intuitive Surgical
Intuitive Surgical (NASDAQ: ISRG) is another promising company, making and selling robotic surgical equipment. In fact, it's a leader in this field, with a recent market value around $182 billion. The company is growing at a solid clip. In January it posted its fourth-quarter results, featuring revenue up 25% year over year and adjusted earnings per share up 38%. Intuitive installed 493 of its da Vinci surgical systems in the quarter, boosting its installed base of machines worldwide by 15%, to nearly 10,000 machines.
A wonderful thing about Intuitive Surgical's business model is that much of its revenue is recurring revenue -- from sales of service contracts, accessories, and supplies for its costly surgical systems. It's the old razor-and-blade model.
Intuitive's revenue surged 25% in 2024, and if the company's market value grows at 20% over the coming decade, that would give it a value of $1.1 trillion. With a recent forward-looking price-to-earnings (P/E) ratio of 62 well above its five-year average of 55, the shares seem overvalued right now, so it might be best to hope for a pullback -- or to buy in incrementally.