Understanding Tesla’s P/E Ratio: A Comprehensive Guide

In the dynamic world of financial analysis, the price-to-earnings ratio (P/E ratio) serves as a crucial indicator of a company’s valuation. For investors seeking to evaluate Tesla’s (TSLA) current market standing, comprehending its P/E ratio is essential. This comprehensive guide delves into the intricacies of Tesla’s P/E ratio, providing insights into its historical trends, comparisons with industry peers, and implications for investment decisions.

What is a P/E Ratio?

The P/E ratio measures the relationship between a company’s stock price and its earnings per share (EPS). It indicates how much investors are willing to pay for each dollar of a company’s earnings. A high P/E ratio suggests that investors anticipate future growth, while a low P/E ratio implies that the company is undervalued or facing challenges

Tesla’s Current P/E Ratio:

As of April 15, 2024, Tesla’s P/E ratio stands at 37.47. This indicates that investors are willing to pay $37.47 for every dollar of Tesla’s earnings. Compared to the broader market, Tesla’s P/E ratio is considered relatively high, reflecting its status as a growth stock with significant future potential.

Historical Trends of Tesla’s P/E Ratio:

Tesla’s P/E ratio has experienced significant fluctuations over the past years, mirroring the company’s rapid growth and evolving market perception. In 2021, Tesla’s P/E ratio reached a staggering high of 1401.73, reflecting investor enthusiasm during its exponential growth phase. However, the ratio has since declined, stabilizing around the current level of 37.47.

Comparison with Industry Peers:

Comparing Tesla’s P/E ratio with its industry peers provides valuable context. As of April 15, 2024, Apple (AAPL) has a P/E ratio of 26.7, while NIO (NIO) and Lucid Motors (LCID) have negative P/E ratios. This suggests that Tesla is valued at a premium compared to some established players but remains in line with other high-growth electric vehicle companies.

Implications for Investment Decisions:

Tesla’s P/E ratio of 37.47 indicates that investors are optimistic about the company’s future growth potential. However, it is crucial to consider that a high P/E ratio also implies higher risk. Investors should carefully evaluate Tesla’s financial performance, market position, and future prospects before making investment decisions.

Tesla’s P/E ratio of 37.47 reflects its status as a high-growth company with significant investor expectations. Understanding the historical trends, industry comparisons, and implications for investment decisions empowers investors to make informed choices regarding Tesla’s stock.

P/E ratio history for Tesla from 2010 to 2023

Year P/E ratio Change
2022 30.6 -83.95%
2021 190 -80.3%
2020 967 -1262.32%
2019 -83.2 44.44%
2018 -57.6 118.03%
2017 -26.4 -40.06%
2016 -44.1 26.48%
2015 -34.8 -63.04%
2014 -94.2 -61.79%
2013 -247 2594.01%
2012 -9.15 -19.23%
2011 -11.3 167.19%
2010 -4.24

P/E ratio as of April 2024 (TTM): 59

The most recent financial reports and stock price for Tesla indicate that the company’s price-to-earnings ratio (TTM) is 51. 871. By the end of 2022, the company’s P/E ratio stood at thirty. 6.

Why is Tesla Stock (TSLA) P/E Ratio So High? [Spoiler Alert – ITS NOT]

FAQ

Does Tesla have a good PE ratio?

P/E ratio as of April 2024 (TTM): 48.4 According to Tesla’s latest financial reports and stock price the company’s current price-to-earnings ratio (TTM) is 48.3578. At the end of 2022 the company had a P/E ratio of 30.6.

What is good PE ratio?

As far as Nifty is concerned, it has traded in a PE range of 10 to 30 historically. Average PE of Nifty in the last 20 years was around 20.* So PEs below 20 may provide good investment opportunities; lower the PE below 20, more attractive the investment potential.

Is Tesla undervalued right now?

Tesla Stock Is Off Its Lows and Still Looks Undervalued – Good for Short Put Income Plays. Tesla Inc (TSLA) stock is up about 10% from its recent lows last month, and TSLA still looks undervalued here based on its FCF. Its put option premiums are still high, which is good for short-put plays for income.

What is the 5 year PE ratio for Tesla?

Tesla’s p/e ratio hit its 5-year low in December 2019 of -90.3x. Tesla’s p/e ratio decreased in 2019 (-90.3x, +183.0%), 2021 (306.7x, -75.9%), and 2022 (34.8x, -88.7%) and increased in 2020 (1,274.1x, -1,510.9%) and 2023 (37.2x, +7.1%).

What is Tesla’s P/E ratio?

The PE ratio marks a decrease of 44% from its last 4 quarters average of 62.1. The average historical PE ratio of Tesla for the last four years is 268.36. The current P/E ratio of 34.86 is 87% lower than the historical average.

What is the PE ratio of Tesla (TSLA)?

The average historical PE ratio of Tesla for the last four years is 268.36. The current P/E ratio of 34.86 is 87% lower than the historical average. Looking back at the last four years, TSLA’s PE ratio peaked in the Dec 2020 quarter at 940.89, when the price was $235.22 and the EPS was $0.25.

What is a good P/E ratio for TSLA?

A stock with a P/E ratio of 20, for example, is said to be trading at 20 times its trailing twelve months earnings. In general, a lower number or multiple is usually considered better than a higher one. Will TSLA be a Portfolio Killer in March?

What is TSLA’s PE ratio?

PE ratio of 40.19 is in the bottom 10% of its industry. Forward pe ratio of 52.63 is in the bottom 10% of its industry. How is TSLA’s pe ratio calculated?

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