Despite Tesla's limited launch of its much-hyped robotaxi service, experts are not sold on the electric vehicle maker's qualifications for investment.
What's happening?
A trio of strategists firmly pressed the brakes on Yahoo Finance's Opening Bid, saying that Tesla stock is already punching above its weight.
The outlet noted that Tesla's forward price-to-earnings multiple was 178 — the S&P 500's was 21. Since 2022, the company's consensus earnings per share for 2025, 2026, and 2027 have plummeted 77%, 70%, and 71%.
"There's a lot of jazz hands going on here," Washington Crossing Advisors co-founder and senior portfolio manager Chad Morganlander said on Opening Bid. "That's 10 times revenue. You have a multiple that's insane."
Why is this important?
The robotaxi space is in its infancy, but Tesla is behind other companies, including Waymo, which Morganlander hailed in his appearance, saying it was "light-years" ahead.
The Alphabet investor touted the Alphabet-owned company, saying: "Waymo has been proven; it's working in many cities. And we believe that this whole robotaxi idea that you're going to let your car go out in the middle of the night and pick up drunk people just to make money is perhaps a little bit foolhardy. We would be more mindful about owning Tesla. We would pick Alphabet instead."
Tesla has also earned more than half its profits from EV tax credits, per Yahoo Finance. The Trump administration is threatening the subsidies with legislation to eliminate the incentives.
Though clean energy investments outperform oil and gas companies' stocks, Tesla sales have slumped in 2025, and the brand has taken a lashing for CEO Elon Musk's role in U.S. government spending cuts and other actions, including support of the far-right Alternative for Germany party. Still, supporters and others are bullish, remaining committed to the company that pioneered the EV movement.
What are the effects of bearish Tesla stock?
The ups and downs of Tesla could hamper the adoption of electric vehicles, which is a big part of the push to cleaner energy technologies. People who make the switch from gas-powered vehicles can save $1,500 a year on fuel and maintenance, and they help reduce the heat-trapping pollution that is hurting human health and supercharging storms.
"As with anything that we've seen from Tesla, it always takes longer than Elon thinks and investors think," Innovator ETFs chief investment strategist Tim Urbanowicz said on Opening Bid. "So, we have to be really conscious of that."
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He said clients who still want to buy Tesla stock are managing risk with "a 10% floor against losses on their NASDAQ exposure."
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