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I think, the consensus is that Tesla would have to be at least as low as around $100-$120/share before there is a margin call on Musk's debt (with Tesla stock a

I think, the consensus is that Tesla would have to be at least as low as around $100-$120/share before there is a margin call on Musk's debt (with Tesla stock as collateral). So it will still have to drop 50% from current levels for the house of cards to start collapsing. But I guess nobody outside Musk and the bankers know the actual price point. Is it possible -- Yes, but not super likely in the near term.

Gud 2y ago
Why not? Even at 50% of its current valuation, Tesla’s market cap would still be twice as high as Toyotas. Doesn’t sound reasonable to me, considering their sales are tanking…
- jqpabc123 2y ago
  Tesla is outrageously overpriced as an auto manufacturer. Most other manufacturers currently have a P/E ratio around 10. Tesla is around 120. Yes, you read that right --- about 12X higher than the competition. To justify it's current valuation, Tesla would have to capture a majority of the global market and become the world's most popular car brand. It currently has around 12% of the global market. In my opinion, what Tesla has to offer just isn't that good and is being rapidly surpassed. https://electrek.co/2025/03/13/mercedes-cla-ev-finally-here-nearly-500-miles-range/ https://electrek.co/2025/03/13/mercedes-cla-ev-finally-here-...
  - joakleaf 2y ago
    The thing is that Tesla isn't priced as car marker, and hasn't been for a long time. People still also talk about Tesla as an AI-company, robot-inventor, battery and solar cell producer, and potential ride-hailing company. Like you, I don't think it makes sense, but apparently the market sees it differently. And until that perception changes, I don't think the valuation will drop to less than half.
    - jqpabc123 2y ago
      The thing is that Tesla isn't priced as car marker, and hasn't been for a long time. The thing is that 90 percent of their revenue is from auto sales. https://stockdividendscreener.com/auto-manufacturers/tesla-quarterly-total-revenue-analysis/ https://stockdividendscreener.com/auto-manufacturers/tesla-q... Meanwhile, the majority of their stock price is pure hype.
      - bdangubic 2y ago
        but that is what the stock market is :) you do not purchase shares on any company because of what they are now (unless P/E ratio is negative :) ), you are investing in the future of the company. I wouldn’t touch Tesla with a wooden stick but you are arguing against basic economics.
        jqpabc123 2y ago
        Actually, Tesla shareholders are the ones arguing against basic economics. Tesla is no longer a "growth stock". Most industry observers are predicting a significant decline in sales for the current quarter. There is no reasonable data or even projected data to support a 12x valuation.
        bdangubic 2y ago
        at the current evaluation there never was… tesla investors are suckers for elon’s “robo”taxi and humanoid robots and I am sure something “amazing” is coming on the next earnings report :)
      - h2zizzle 2y ago
        Not exactly. Word on the street is that Tesla stock was heavily short-sold at one time, as it was expected to be headed for bankruptcy. When it turned out to not be headed for bankruptcy, those who had shorted were forced to either close their positions (raising the stock price as their demand hit for shares hit the market) or cover (pay to keep their short agreements going) for an extended period of time. But it wasn't a one-time event; as the price rose, and time went on, more of those who'd shorted Tesla found their position untenable, which forced them to finally close, further raising the price. Elon famously derided the investors who'd caused this situation. He was livid at them, and also at the SEC for allowing what he considered to be unfair, if not illegal, conduct on the part of short-sellers. A stock that is heavily short-sold can have its price drop to the point that financing is difficult to obtain, sounding the death knell for that business. But it looks like that came back to bite shorts when Tesla survived. This is definitely a bit of a crackpot theory without some numerical analysis to back it up, but mindless "pure hype" seems a less compelling explanation for the valuation we see than financial/securities shenanigans, especially after what happened with Gamestop.
  - ahahahahah 2y ago
    TIL 1.79million / 74.6million = 12%. I'd always thought it was more like 2.5%.
    - jqpabc123 2y ago
      Yes, you are correct. Which only further enhances the overall point, there is no reasonable auto marketplace data (actual or even projected) to support the current valuation. The "Magnificent 7" should really only be 6 with Tesla being the odd one out. Some of the reports on it from stock market "analysts" are almost comical and often rely on an appeal to tradition --- it's always been this way. Exactly the sort of nonsense cold hard "analysis" is supposed to cut through. It's as if there is some significant pressure to emotionally support the big investors that are heavily bought in.
Zigurd 2y ago
If TSLA were priced like a car maker it would be $10. Direct sales and the charging network, could, generously, make it $30. Which would ignore the existential threat of Cybertruck. If the Rivian R2 had been Cybertruck, we'd be posting about the liquidation auction.

Gud 2y ago

Why not? Even at 50% of its current valuation, Tesla’s market cap would still be twice as high as Toyotas. Doesn’t sound reasonable to me, considering their sales are tanking…

jqpabc123 2y ago
Tesla is outrageously overpriced as an auto manufacturer. Most other manufacturers currently have a P/E ratio around 10. Tesla is around 120. Yes, you read that right --- about 12X higher than the competition. To justify it's current valuation, Tesla would have to capture a majority of the global market and become the world's most popular car brand. It currently has around 12% of the global market. In my opinion, what Tesla has to offer just isn't that good and is being rapidly surpassed. https://electrek.co/2025/03/13/mercedes-cla-ev-finally-here-nearly-500-miles-range/ https://electrek.co/2025/03/13/mercedes-cla-ev-finally-here-...
- joakleaf 2y ago
  The thing is that Tesla isn't priced as car marker, and hasn't been for a long time. People still also talk about Tesla as an AI-company, robot-inventor, battery and solar cell producer, and potential ride-hailing company. Like you, I don't think it makes sense, but apparently the market sees it differently. And until that perception changes, I don't think the valuation will drop to less than half.
  - jqpabc123 2y ago
    The thing is that Tesla isn't priced as car marker, and hasn't been for a long time. The thing is that 90 percent of their revenue is from auto sales. https://stockdividendscreener.com/auto-manufacturers/tesla-quarterly-total-revenue-analysis/ https://stockdividendscreener.com/auto-manufacturers/tesla-q... Meanwhile, the majority of their stock price is pure hype.
    - bdangubic 2y ago
      but that is what the stock market is :) you do not purchase shares on any company because of what they are now (unless P/E ratio is negative :) ), you are investing in the future of the company. I wouldn’t touch Tesla with a wooden stick but you are arguing against basic economics.
      - jqpabc123 2y ago
        Actually, Tesla shareholders are the ones arguing against basic economics. Tesla is no longer a "growth stock". Most industry observers are predicting a significant decline in sales for the current quarter. There is no reasonable data or even projected data to support a 12x valuation.
        bdangubic 2y ago
        at the current evaluation there never was… tesla investors are suckers for elon’s “robo”taxi and humanoid robots and I am sure something “amazing” is coming on the next earnings report :)
    - h2zizzle 2y ago
      Not exactly. Word on the street is that Tesla stock was heavily short-sold at one time, as it was expected to be headed for bankruptcy. When it turned out to not be headed for bankruptcy, those who had shorted were forced to either close their positions (raising the stock price as their demand hit for shares hit the market) or cover (pay to keep their short agreements going) for an extended period of time. But it wasn't a one-time event; as the price rose, and time went on, more of those who'd shorted Tesla found their position untenable, which forced them to finally close, further raising the price. Elon famously derided the investors who'd caused this situation. He was livid at them, and also at the SEC for allowing what he considered to be unfair, if not illegal, conduct on the part of short-sellers. A stock that is heavily short-sold can have its price drop to the point that financing is difficult to obtain, sounding the death knell for that business. But it looks like that came back to bite shorts when Tesla survived. This is definitely a bit of a crackpot theory without some numerical analysis to back it up, but mindless "pure hype" seems a less compelling explanation for the valuation we see than financial/securities shenanigans, especially after what happened with Gamestop.
- ahahahahah 2y ago
  TIL 1.79million / 74.6million = 12%. I'd always thought it was more like 2.5%.
  - jqpabc123 2y ago
    Yes, you are correct. Which only further enhances the overall point, there is no reasonable auto marketplace data (actual or even projected) to support the current valuation. The "Magnificent 7" should really only be 6 with Tesla being the odd one out. Some of the reports on it from stock market "analysts" are almost comical and often rely on an appeal to tradition --- it's always been this way. Exactly the sort of nonsense cold hard "analysis" is supposed to cut through. It's as if there is some significant pressure to emotionally support the big investors that are heavily bought in.

Zigurd 2y ago

If TSLA were priced like a car maker it would be $10. Direct sales and the charging network, could, generously, make it $30. Which would ignore the existential threat of Cybertruck. If the Rivian R2 had been Cybertruck, we'd be posting about the liquidation auction.