Tesla's (TSLA) long-awaited robotaxi event largely disappointed investors who were left wanting more details. CFRA analyst Garrett Nelson joins Morning Brief to discuss how the event is weighing on Tesla's stock and whether CEO Elon Musk can deliver value to shareholders.

Nelson believes that the decline in Tesla's stock could be the beginning of a larger pullback. "If you look at where it's trading on consensus estimates, the stock where it closed yesterday is trading at 75 times consensus estimates for next year. Looking out to 2026, it's trading at 57 times. So these are really pretty lofty multiples. And here we're left with a lot of questions regarding how it's going to achieve that earnings growth that is embedded in expectations over the next few years," he tells Yahoo Finance.

He adds, "This is a high-growth stock whose growth has hit a wall here recently."

Nelson points out that Elon Musk has a history of not meeting previously communicated timelines: "If you look back a decade ago, he was promising fully autonomous vehicles only a year or two away. Here we are in 2024, and it's still that. We think Tesla is still a ways away from that." Thus, he believes that the investors' expectations are "too high," especially given a general slowing of EV sales.

With such a lack of clarity around Tesla's product pipeline, Nelson argues that auto names like General Motors (GM) and Uber (UBER) are among the best positioned to win when Tesla loses.

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This post was written by Melanie Riehl