In today’s rapidly changing and fiercely competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies. This article conducts a comprehensive industry comparison, evaluating Tesla against its key competitors in the Automobiles industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on the company’s performance within the industry.
Tesla Background
Tesla is a vertically integrated battery electric vehicle automaker and developer of real-world artificial intelligence software, which includes autonomous driving and humanoid robots. The company has multiple vehicles in its fleet, including:
- Luxury and midsize sedans
- Crossover SUVs
- A light truck
- A semi-truck
Tesla also plans to begin selling a sports car and offer a robotaxi service. Global deliveries in 2025 were nearly 1.64 million vehicles. The company sells batteries for stationary storage for residential and commercial properties, including utilities and solar panels and solar roofs for energy generation. Tesla also owns a fast-charging network and an auto insurance business.
Comparative Financial Analysis
The following table provides a comparative analysis of Tesla’s financial metrics with its industry peers:
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Tesla Inc | 385.70 | 19.03 | 15.50 | 1.04% | $3.66 | $5.05 | -11.37% |
| General Motors Co | 26.38 | 1.28 | 0.45 | -5.22% | $0.42 | -$1.12 | -5.06% |
| Ferrari NV | 31.40 | 13.22 | 7.11 | 10.42% | $0.67 | $0.88 | 7.4% |
| Ford Motor Co | 11.97 | 1.18 | 0.30 | 5.29% | $3.67 | $4.3 | 9.39% |
| Thor Industries Inc | 21.39 | 1.39 | 0.61 | 0.5% | $0.11 | $0.32 | 11.5% |
| Winnebago Industries Inc | 36.45 | 1.07 | 0.46 | 0.45% | $0.03 | $0.09 | 12.32% |
| Workhorse Group Inc | 0.06 | 1.31 | 0.31 | -28.77% | -$0.01 | -$0.01 | -4.97% |
| Average | 21.28 | 3.24 | 1.54 | -2.89% | $0.82 | $0.74 | 5.1% |
Key Trends and Takeaways
By closely examining Tesla, we can identify the following trends:
- The current Price to Earnings ratio for Tesla is 385.7, which is 18.12x above the industry norm, reflecting a higher valuation relative to the industry.
- With a Price to Book ratio of 19.03, which is 5.87x the industry average, Tesla might be considered overvalued in terms of its book value.
- The Price to Sales ratio of 15.5 suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
- The company has a higher Return on Equity (ROE) of 1.04%, which is 3.93% above the industry average, indicating efficient use of equity to generate profits.
- The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $3.66 Billion is 4.46x above the industry average, highlighting stronger profitability and robust cash flow generation.
- Compared to its industry, the company has a higher gross profit of $5.05 Billion, which indicates 6.82x above the industry average, indicating stronger profitability and higher earnings from its core operations.
- The company’s revenue growth of -11.37% is significantly lower compared to the industry average of 5.1%, indicating a potential fall in the company’s sales performance.
Debt to Equity Ratio
The debt-to-equity (D/E) ratio provides insights into the proportion of debt a company has in relation to its equity and asset value. When evaluating Tesla alongside its top 4 peers in terms of the Debt-to-Equity ratio, the following insights arise:
- Tesla is in a relatively stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.1.
- This implies that the company relies less on debt financing and has a more favorable balance between debt and equity.
Conclusion
For Tesla, the PE, PB, and PS ratios are all high compared to its industry peers, indicating that the stock may be overvalued based on these metrics. On the other hand, Tesla’s high ROE, EBITDA, gross profit, and low revenue growth suggest strong operational performance and profitability relative to its competitors in the Automobiles industry.