Elon Musk's Tesla Stock Overvalued By 1,000% — Market Price 'Disconnected From Reality,' Says Analyst

Elon Musk‘s Tesla Inc. (NASDAQ:TSLA) may be riding high on the AI-fueled tech stock boom of 2023, but not everyone is convinced of its valuation.

David Trainer, CEO of investment research firm New Constructs, suggests that the electric vehicle (EV) giant is more than 1,000% overvalued, Business Insider reports.

Disconnect from Reality

“The company’s fundamentals are disconnected from reality,” Trainer wrote in a note, questioning Tesla’s “lackluster” production figures and shrinking gross profit margin.

He argues that to justify its current stock price, Tesla would need to boost its return on invested capital to levels not achieved by even the most profitable businesses in the world.

See Also: Elon Musk’s Tesla Is Worth $26 A Share, Analyst Says: One Of The Most Overvalued Stocks

Contrasting Views

Despite Trainer’s bearish outlook, other analysts remain bullish. Dan Ives, CEO of Wedbush, compared Tesla’s position to Apple’s in the late 2000s, where its stock price did not yet reflect its earnings potential.

“We view this quarter as a major step in the right direction – as Tesla is playing chess while others play checkers,” Ives wrote.

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