Tesla (TSLA) Faces Scrutiny as Morgan Stanley Flags Valuation Gaps
In This Article:
Tesla (TSLA, Financials) continues to draw scrutiny from Wall Street as Morgan Stanley's Adam Jonas said the company's valuation is increasingly difficult to justify, even after 15 years on the public market.
Tesla trades at a price-to-earnings ratio of 181.98x, well above most growth stocks. The stock is up more than 95% over the past 12 months but has declined 15% so far in 2025. According to TipRanks data cited in the report, much of Tesla's valuation rests on opaque or pre-commercialized business segments.
Jonas maintains a Buy rating with a $410 price target, suggesting nearly 20% upside. But he said most investors continue to evaluate Tesla solely based on its electric vehicle unitassigning just $50$100 per share to that segmentwhile overlooking other high-potential verticals.
Morgan Stanley's sum-of-the-parts model gives significant weight to Tesla's energy storage, robotaxi, and humanoid robot businesses. Jonas estimates the energy storage segment alone is worth $67 per share, excluding future recurring revenues.
The autonomous Cybercab service is expected to launch in Austin next month with 10 to 20 vehicles. Additionally, Jonas projected that Tesla's Optimus robot, if it replaces just 1% of global human labor, could add over $300 billion in valueor about $100 per share.
Jonas argued that investors' narrow focus is equivalent to valuing Amazon (AMZN, Financials) solely as a retailer or Apple (AAPL, Financials) only as a device company, missing the broader innovation ecosystem.
Investors should monitor Tesla's upcoming robotaxi rollout and a potential Optimus event later in 2025 as catalysts that could reshape the company's valuation narrative.
This article first appeared on GuruFocus.