Skip to Content
Morningstar
Get 14 Days Free

Tesla Inc TSLA

Morningstar Rating
Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
Is it the right time to buy or sell?
Find out with Morningstar Premium
Is it the right time to buy or sell?
Find out with Morningstar Premium

1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Stewardship

PREMIUM

Tesla's Battery Day Does Not Meet Its Hype but Lays Out a Path to Fight Climate Change

Analyst Note

| David Whiston, CFA, CPA, CFE |

Given Tesla’s stock's incredible runup, we were skeptical that its long-awaited Sept. 22 Battery Day event would meet market expectations and the stock fell about 7% in afterhours trading. We liked what we heard, though, and new products, such as Plaid Mode for the Model S due in late 2021 and a $25,000 vehicle in about three years, bring opportunities for more volume. CEO Elon Musk said he expects 2020 delivery growth of 30%-40%, which puts 2020 deliveries close to or over 500,000 versus the 400,000 we model. Based on continued strong demand for Tesla’s vehicles, we are increasing volume deliveries for 2020-29 by about 10%. This increase along with battery cost reductions outlined at Battery Day led us to increase modeled revenue for the energy storage business across 2020-29 by about 33%. As a result, we expect to increase our fair value estimate by about 13%.

Read Full Analysis

Company Profile

Business Description

Founded in 2003 and based in Palo Alto, California, Tesla is a vertically integrated sustainable energy company that also aims to transition the world to electric mobility by making electric vehicles. It sells solar panels and solar roofs for energy generation plus batteries for stationary storage for residential and commercial properties including utilities. It also makes solar roofs and plans to enter the HVAC market. The Tesla Roadster debuted in 2008, Model S in 2012, Model X in 2015, Model 3 in 2017, and Model Y in 2020. Global deliveries in 2019 were 367,656 units. Tesla went public in 2010 and employs about 50,000 people.

Contact
3500 Deer Creek Road
Palo Alto, CA, 94304
T +1 650 681-5000
Sector Consumer Cyclical
Industry Auto Manufacturers
Most Recent Earnings Jun 30, 2020
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 48,016

Related

Fund Spy
An Excellent--and Aggressive--Choice for Growth Seekers
Consistently good stock selection over the long haul has earned Harbor Capital Appreciation an enviable track record.
Robby Greengold
Stock Analyst Update
Falling Lithium Prices Provide Buying Opportunity
Following the Tesla battery day event, lithium producer stock prices plunged. We see no change to our outlook for lithium.
Seth Goldstein
Stock Analyst Update
Tesla's Battery Day Shows Path to Fight Climate Change
We expect to increase our fair value estimate by about 13%.
David Whiston
Market Update
Are Nasdaq Stocks Really Overvalued?
The tech-focused index has hit record highs this year before a rough patch in September. How are its biggest companies valued after recent volatility?
James Gard
Rekenthaler Report
Is Tesla's Stock Price Crazy or Merely Aggressive?
Placing the company’s valuation into historical context.
John Rekenthaler
Market Update
More Risk, More Reward for U.S. Equity Funds
U.S. stock funds leading the rebound share a common trait: Morningstar Risk ratings of High.
David Carey
Our Picks
4 High-Quality Bargains in an Uncertain Market
These undervalued wide-moat stocks earn low uncertainty ratings.
Susan Dziubinski
Market Update
New Fair Values for Apple, Tesla After Stock Splits
After adjusting our fair value estimates, both stocks still look rich.
Susan Dziubinski
The Short Answer
What is a Stock Split?
Companies like to play with the price of their stocks. Here’s why and what you should know.
Ruth Saldanha
Rekenthaler Report
Stock Investors Are From Mars, Bond Investors Are From Venus
The two assets have responded very differently to the coronavirus crisis.
John Rekenthaler
Stock Analyst Update
Tesla Panders With 5-1 Stock Split Announcement
Retail investors will find shares more attractive after this move, though it doesn't affect the intrinsic value of the company.
David Whiston
Market Update
Who’s Growing Dividends in Today’s Market?
Morningstar indexes spotlight rising equity income streams.
Dan Lefkovitz
Stock Analyst Update
Tesla Posts a Profit Which May Lead to S&P500 Inclusion
Tesla reported profitable second-quarter GAAP results, and adjusted diluted EPS of $2.18 rose significantly from the prior year’s quarterly loss of $1.12.
David Whiston
Commentary
The Week Ahead: Coca-Cola, Amazon, and Microsoft to Report Earnings
We're also watching for reports from United, American Airlines, and Southwest. 
Carole Hodorowicz
Market Update
Growth Parties Like It's 1999, but Don't Rule Out Value
Morningstar style indexes reveal market divergence and opportunity.
Dan Lefkovitz
Stock Analyst Update
Tesla Posts a 1Q Profit for the First Time
We are increasing our fair value estimate to $731 from $239. If a recession can’t stop Tesla then virtually nothing will, and we expect the company to remain a leader in autonomous technology and range.
David Whiston
Fund Spy
What Medalist Managers Are Buying and Selling
A look at some of the industry leaders' recent moves.
Nicholas Goralka
Commentary
The Week Ahead: Apple, Facebook, and Boeing to Report Earnings
We are also on the lookout for reports from Southwest, Microsoft, and Exxon Mobil.
Carole Hodorowicz
Commentary
The Week Ahead: Amazon, AT&T, and Verizon to Report Earnings
We also have our eye on earnings reports from Tesla, Starbucks, and Netflix, along with names in the financial-services and technology sectors.
Carole Hodorowicz
Fund Spy
U.S. Stock Funds Say Goodbye Bull Market, Hello Volatility at Quarter-End
Investors grappled with record-breaking volatility in a historic quarter.
Nick Watson