Tesla (TSLA) AI Stock Analysis

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Tesla

(NASDAQ:TSLA)

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Neutral 60 (OpenAI - 5.2)

Rating:60Neutral

Price Target:

$437.00

▲(4.70% Upside)

Action:ReiteratedDate:01/30/26

The score is anchored by Tesla’s solid balance sheet and sustained cash generation but is held back by sharply weaker growth and profitability into 2025. Technicals are bearish (below key moving averages with negative MACD), and valuation is a major headwind given the very high P/E. The earnings call adds some support via margin improvement and energy/FSD/autonomy progress, but near-term delivery softness and the >$20B CapEx ramp raise execution and cash-burn risk.

Positive Factors

Balance Sheet Strength

Very low leverage and a >$44B liquidity cushion provide durable financial flexibility to fund large strategic investments, absorb execution hiccups, and reduce refinancing risk. This positions the company to pursue capex and R&D without immediate reliance on external capital markets.

Consistent Cash Generation

Sustained operating cash flow and recurring positive free cash flow across multiple years underpin the company’s ability to self-fund expansion, support R&D and software development, and weather cyclical auto demand. Reliable cash generation is a durable buffer for strategic initiatives.

Energy Business Diversification

Rapid, high‑growth energy and storage deployments create a growing, less cyclical revenue stream beyond vehicles. Record deployments and a growing backlog enhance revenue diversification, supporting long-term margin resilience and penetration into utility and commercial energy markets.

Negative Factors

Slowing Growth & Margin Compression

A pronounced deterioration in revenue growth and margins materially reduces returns on invested capital and weakens earnings quality. If sustained, this trend limits reinvestment capacity, undermines long-term profitability targets, and raises the bar for operational improvements to restore prior ROI levels.

Very Large CapEx Ramp

A multi‑year >$20B investment program meaningfully raises execution and funding risk. Even with substantial cash, such scale accelerates cash burn, increases project complexity across geographies, and may necessitate external financing or divert resources from margin-improving initiatives if execution slips.

Battery Supply Constraint

Persistent battery pack shortages limit vehicle production, constrain fixed-cost absorption, and force interim design workarounds. As batteries are structurally central to EV scale and cost, ongoing supply constraints pose a lasting bottleneck to volume growth, margin recovery, and meeting backlog.

Tesla (TSLA) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$1.54T

Dividend YieldN/A

Average Volume (3M)56.15M

Price to Earnings (P/E)387.9

Beta (1Y)1.95

Revenue Growth-2.93%

EPS Growth-47.22%

CountryUS

Employees125,665

SectorConsumer Cyclical

Sector Strength84

IndustryAuto - Manufacturers

Share Statistics

EPS (TTM)0.50

Shares Outstanding3,752,432,000

10 Day Avg. Volume51,939,182

30 Day Avg. Volume56,153,629

Financial Highlights & Ratios

PEG Ratio-8.13

Price to Book (P/B)17.69

Price to Sales (P/S)15.32

P/FCF Ratio233.61

Enterprise Value/Market Cap1.01

Enterprise Value/Revenue16.43

Enterprise Value/Gross Profit91.15

Enterprise Value/Ebitda132.45

Forecast

1Y Price Target

$396.80

Price Target Upside-4.94% Downside

Rating ConsensusHold

Number of Analyst Covering30

EPS Forecast (FY)1.99

Revenue Forecast (FY)$104.03B

Tesla Business Overview & Revenue Model

Company DescriptionTesla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. It operates in two segments, Automotive, and Energy Generation and Storage. The Automotive segment offers electric vehicles, as well as sells automotive regulatory credits; and non-warranty after-sales vehicle, used vehicles, retail merchandise, and vehicle insurance services. This segment also provides sedans and sport utility vehicles through direct and used vehicle sales, a network of Tesla Superchargers, and in-app upgrades; purchase financing and leasing services; services for electric vehicles through its company-owned service locations and Tesla mobile service technicians; and vehicle limited warranties and extended service plans. The Energy Generation and Storage segment engages in the design, manufacture, installation, sale, and leasing of solar energy generation and energy storage products, and related services to residential, commercial, and industrial customers and utilities through its website, stores, and galleries, as well as through a network of channel partners; and provision of service and repairs to its energy product customers, including under warranty, as well as various financing options to its solar customers. The company was formerly known as Tesla Motors, Inc. and changed its name to Tesla, Inc. in February 2017. Tesla, Inc. was incorporated in 2003 and is headquartered in Austin, Texas.

How the Company Makes MoneyTesla generates revenue primarily through the sale of electric vehicles, which accounts for the largest share of its income. The company offers a diverse range of EV models, catering to different market segments, from luxury to more affordable options. In addition to vehicle sales, Tesla earns money through regulatory credits, which it sells to other automakers who need to comply with emissions regulations. Another significant revenue stream comes from energy generation and storage products, including solar panels and battery systems. Tesla's growing service and maintenance segment also contributes to its earnings, as do software updates and features that enhance vehicle functionality. The company has established partnerships with suppliers and technology firms that enhance its production capabilities and market reach, further supporting its revenue growth.

Tesla Key Performance Indicators (KPIs)

Any

Revenue by Geography

Revenue by Geography
Breaks down revenue across different regions, revealing where Tesla is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.

Chart InsightsTesla's revenue growth in North America and China has been robust, with recent quarters showing significant increases, particularly in North America. The latest earnings call highlights a 28% rise in North American deliveries and a 33% increase in Greater China and APAC, reflecting strong demand and strategic focus in these regions. However, challenges such as tariff impacts and regulatory hurdles in FSD deployment could pose risks. Tesla's commitment to AI and energy storage innovations suggests a strategic pivot towards sustainable growth and technological leadership.

Data provided by:

The Fly

Tesla Earnings Call Summary

Earnings Call Date:Jan 28, 2026

(Q4-2025)

% Change Since: |

Next Earnings Date:Apr 28, 2026

Earnings Call Sentiment Positive

The call outlines significant operational progress and record performance in key areas — improved automotive margins, strong FSD adoption, record energy revenue and gross margin, and concrete autonomy/robotaxi milestones (unsupervised rides and expanding fleet). At the same time, it candidly describes material near-term challenges: a 16% sequential drop in deliveries, battery pack constraints, margin pressure from the FSD subscription shift, rising operating expenses (+$500 million), Bitcoin and FX hits to net income, and a very large >$20 billion CapEx plan that elevates cash burn and funding risk. The company frames these negatives as temporary or strategic trade-offs to fund acceleration into autonomy, Optimus, chips, and solar — positioning for long-term growth while accepting near-term margin and cash pressure.

Q4-2025 Updates

Positive Updates

Sequential Improvement in Automotive Margins

Automotive margins excluding credits rose sequentially from 15.4% to 17.9% (up 2.5 percentage points), with automotive gross profit flat sequentially despite a 16% decline in deliveries due to favorable regional mix (higher APAC and EMEA share).

Strong FSD Adoption

FSD reached nearly 1,100,000 paid customers globally, with ~70% of those being upfront purchases; company is transitioning fully to a subscription model beginning this quarter (near-term margin impact expected).

Energy Business Growth and Records

Energy achieved record gross profit in the quarter and finished the year with nearly $12.8 billion in revenue, representing 26.6% year-over-year growth; backlog remains strong and MegaPack 3 and Mega Block launches expected to drive deployments.

Improved Aggregate Gross Margin

Total gross margin finished the quarter above 20.1%, the highest level in over two years, achieved despite tariff headwinds and lower fixed cost absorption.

Robotaxi and Autonomy Progress

Public unsupervised robotaxi rides launched in Austin (cars operating with no driver, no safety monitor, no chase car); company reports over 500 taxi vehicles carrying paid customers between Bay Area and Austin and expects fleet expansion on an exponential curve.

Storage Deployments Record and Global Vehicle Backlog

Storage deployments hit another record; Tesla ended 2025 with a larger vehicle backlog than recent years and record deliveries in multiple smaller markets (Malaysia, Norway, Poland, Saudi Arabia, Taiwan).

Positive Free Cash Flow and Cash Position

Free cash flow for the quarter was $1.4 billion and the company holds over $44 billion in cash and investments to support upcoming investments.

Strategic Technology and Manufacturing Investments

Company is prioritizing major investments (batteries, AI chips, solar cell production, Optimus, CyberCab, Semi) and advancing in-house AI chip designs (AI5/AI6) to address long-term supply constraints and vertical integration.

Negative Updates

Sequential Decline in Deliveries

Vehicle deliveries declined 16% sequentially, pressuring volume-driven fixed cost absorption and constraining near-term revenue and margin dynamics despite flat automotive gross profit.

Battery Pack Supply Constraint

Battery pack availability remains the biggest global constraint; teams resorted to interim measures (e.g., using 4,680 cells in non-structural packs) while iterating on improvements.

Transition of FSD to Subscription Impacts Margins

Transition to a subscription-based FSD model began this quarter; company noted that net additions via subscription will primarily drive growth but will have a short-term negative impact on automotive margins.

Rising Operating Expenses

Operating expenses increased sequentially by about $500 million in Q4, primarily from higher stock-based compensation and a charge related to a 2025 performance award; elevated AI and new-product spending expected to continue through 2026.

Services & Other Margin Decline

Services and other margin declined from 10.5% to 8.8% (down 1.7 percentage points), driven primarily by higher employee-related costs to prepare service centers for fleet growth.

Net Income Headwinds: Bitcoin and FX

Net income was negatively impacted by a 23% depreciation in a Bitcoin holding quarter-over-quarter and by unfavorable FX effects related to large intercompany borrowings.

Margin Pressure and Competitive/Policy Risks in Energy

Management expects margin compression in energy due to increased low-cost competition, policy uncertainty, and tariff-related costs.

Very Large CapEx Plan and Funding Risk

CapEx outlook for 2026 expected to exceed $20 billion (vs. prior ~ $9 billion guidance for the prior period), funding extensive investments across six new/expanded factories and AI compute — this materially increases cash burn risk and may require external financing despite a large cash balance.

Optimistic but Risky Optimus Ramp

Optimus production is planned at large scale (Fremont conversion target of ~1 million units/year) but management warns of a stretched S-curve because Optimus requires an almost entirely new supply chain; meaningful production volume not expected until late in the year.

Company Guidance

Tesla guided to an aggressive 2026 investment phase with CapEx expected in excess of $20 billion (after 2025 CapEx came in slightly below prior ~$9B guidance), funding six new factories (refinery, LFP, CyberCab, Semi, a new mega factory and Optimus) while holding over $44 billion in cash and investments; Q4 free cash flow was $1.4 billion, operating expenses rose by ~$500 million sequentially, and net income was hurt by a 23% markdown on Bitcoin and FX headwinds. On margins and revenue, automotive gross margin excluding credits improved from 15.4% to 17.9% and automotive gross profit was flat despite deliveries falling 16% sequentially, services & other margin declined from 10.5% to 8.8%, and total gross margin exceeded 20.1%. Energy finished the year with nearly $12.8 billion in revenue (up 26.6% YoY) and record deployments, while FSD reached ~1.1 million paid customers (~70% upfront purchases) as Tesla shifts to a subscription model (near‑term margin headwind); Tesla expects fully autonomous vehicles in roughly a quarter to a half of the U.S. by year‑end (dozens of major cities), reports over ~500 robotaxi vehicles in service today with fleet growth accelerating, and targets a long‑term Optimus run rate of ~1 million units/year.

Tesla Financial Statement Overview

Summary

Strong balance sheet (low leverage and substantial equity base) and consistently positive operating cash flow/free cash flow, but earnings quality has weakened materially: revenue growth turned to a sharp decline in 2025 and margins compressed significantly (gross margin ~26% in 2022 to ~18% in 2024–2025; net margin ~15% to ~4%), pulling returns (ROE ~28% to ~5%) lower.

Income Statement

Neutral

Revenue growth has cooled materially, shifting from strong expansion in 2021–2023 to modest growth in 2024 and a sharp decline in 2025. Profitability also compressed: gross margin fell from ~26% (2022) to ~18% (2024–2025), and net margin dropped from ~15% (2022–2023) to ~4% (2025). While the company remains profitable, the trajectory shows meaningful pressure on pricing and/or costs, with operating earnings down notably versus prior years.

Balance Sheet

Very Positive

The balance sheet looks strong and conservatively levered. Debt levels are modest relative to equity (debt-to-equity ~0.10 in 2025, improved from ~0.60 in 2020), and equity has grown substantially over time, supporting financial flexibility. The main weakness is profitability on equity trending down sharply (return on equity fell from ~28% in 2022 to ~5% in 2025), reflecting lower earnings rather than balance sheet stress.

Cash Flow

Positive

Cash generation remains solid with operating cash flow consistently strong (roughly $11–15B across 2021–2025), and free cash flow stayed positive each year. However, free cash flow has been volatile and generally down versus the peak period (notably weaker growth in 2023–2025), and free cash flow covers a relatively modest share of net income in several years, indicating less efficient conversion of profits into discretionary cash. Overall, liquidity generation is a strength, but momentum has softened.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	94.83B	97.69B	96.77B	81.46B	53.82B
Gross Profit	17.09B	17.45B	17.66B	20.85B	13.61B
EBITDA	11.76B	14.71B	14.80B	17.66B	9.63B
Net Income	3.79B	7.13B	15.00B	12.58B	5.52B
Balance Sheet
Total Assets	137.81B	122.07B	106.62B	82.34B	62.13B
Cash, Cash Equivalents and Short-Term Investments	44.06B	36.56B	29.09B	22.18B	17.71B
Total Debt	8.38B	13.62B	9.57B	5.75B	8.87B
Total Liabilities	54.94B	48.39B	43.01B	36.44B	30.55B
Stockholders Equity	82.14B	72.91B	62.63B	44.70B	30.19B
Cash Flow
Free Cash Flow	6.22B	3.58B	4.36B	7.55B	3.48B
Operating Cash Flow	14.75B	14.92B	13.26B	14.72B	11.50B
Investing Cash Flow	-15.48B	-18.79B	-15.58B	-11.97B	-7.87B
Financing Cash Flow	1.14B	3.85B	2.59B	-3.53B	-5.20B

Tesla Technical Analysis

Technical Analysis Sentiment

Positive

Last Price417.40

Price Trends

50DMA

438.60

Negative

100DMA

436.86

Negative

200DMA

389.69

Positive

Market Momentum

MACD

-6.75

Negative

RSI

48.11

Neutral

STOCH

35.10

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSLA, the sentiment is Positive. The current price of 417.4 is above the 20-day moving average (MA) of 415.70, below the 50-day MA of 438.60, and above the 200-day MA of 389.69, indicating a neutral trend. The MACD of -6.75 indicates Negative momentum. The RSI at 48.11 is Neutral, neither overbought nor oversold. The STOCH value of 35.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSLA.

Tesla Risk Analysis

Tesla disclosed 40 risk factors in its most recent earnings report. Tesla reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Tesla Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TM	78 Outperform	$305.87B	12.62	10.34%	2.57%	7.28%	12.41%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
TSLA	60 Neutral	$1.54T	387.92	4.89%	―	-2.93%	-47.22%
LI	55 Neutral	$18.52B	30.88	6.53%	―	-9.99%	-54.75%
RIVN	50 Neutral	$18.76B	-4.97	-65.55%	―	28.21%	44.43%
LCID	49 Neutral	$3.22B	-0.85	-61.12%	―	45.86%	22.13%
NIO	45 Neutral	$11.98B	-3.57	-296.44%	―	14.94%	2.53%

* Consumer Cyclical Sector Average

Performance Comparison

TSLA

Tesla

417.40

126.60

43.54%

Toyota Motor

241.73

60.52

33.40%

NIO

Nio

5.19

0.47

9.96%

Li Auto

18.45

-14.47

-43.96%

LCID

Lucid Group

10.28

-12.27

-54.41%

RIVN

Rivian Automotive

15.25

3.85

33.77%

Tesla Corporate Events

Executive/Board ChangesShareholder Meetings

Tesla Shareholders Approve Key Proposals at Annual Meeting

Neutral

Nov 7, 2025

On November 6, 2025, Tesla‘s shareholders approved several proposals at the annual meeting, including the amended and restated 2019 Equity Incentive Plan, which aims to attract and retain employees and consultants through various stock-based awards. The meeting also saw the election of Class III directors and approval of executive compensation and the 2025 CEO Performance Award. However, several shareholder proposals, including those related to sustainability metrics and a child labor audit, were not approved. The approval of the A&R 2019 Equity Incentive Plan is expected to enhance Tesla’s ability to incentivize its workforce, potentially impacting its operational efficiency and market competitiveness.

The most recent analyst rating on (TSLA) stock is a Sell with a $247.00 price target. To see the full list of analyst forecasts on Tesla stock, see the TSLA Stock Forecast page.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jan 30, 2026