In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. This article will undertake a comprehensive industry comparison, evaluating Tesla and its primary competitors in the Automobiles industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company 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, and 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.
Financial Metrics Comparison
The following table compares key financial metrics of Tesla with its industry peers:
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Tesla Inc | 375.94 | 18.55 | 15.11 | 1.04% | $2.91 | $5.01 | -3.14% |
| General Motors Co | 26.39 | 1.28 | 0.45 | -5.22% | $0.42 | -$1.12 | -5.06% |
| Ferrari NV | 32.02 | 13.48 | 7.25 | 10.42% | $0.67 | $0.88 | 7.4% |
| Ford Motor Co | 11.81 | 1.16 | 0.29 | 5.29% | $3.67 | $4.3 | 9.39% |
| Thor Industries Inc | 22.79 | 1.48 | 0.65 | 0.5% | $0.11 | $0.32 | 11.5% |
| Winnebago Industries Inc | 38.95 | 1.14 | 0.49 | 0.45% | $0.03 | $0.09 | 12.32% |
| Workhorse Group Inc | 0.06 | 1.26 | 0.30 | -28.77% | -$0.01 | -$0.01 | -4.97% |
| Average | 22.0 | 3.3 | 1.57 | -2.89% | $0.82 | $0.74 | 5.1% |
Trends and Insights
After thoroughly examining Tesla, the following trends can be inferred:
- At 375.94, the stock’s Price to Earnings ratio significantly exceeds the industry average by 17.09x, suggesting a premium valuation relative to industry peers.
- It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 18.55, which exceeds the industry average by 5.62x.
- With a relatively high Price to Sales ratio of 15.11, which is 9.62x the industry average, the stock might be considered overvalued based on sales performance.
- The company has a higher Return on Equity (ROE) of 1.04%, which is 3.93% above the industry average, suggesting efficient use of equity to generate profits and demonstrating profitability and growth potential.
- With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $2.91 Billion, which is 3.55x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.
- Compared to its industry, the company has higher gross profit of $5.01 Billion, which indicates 6.77x above the industry average, indicating stronger profitability and higher earnings from its core operations.
- The company is witnessing a substantial decline in revenue growth, with a rate of -3.14% compared to the industry average of 5.1%, which indicates a challenging sales environment.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company’s capital structure. Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company’s financial health and risk profile, aiding in informed decision-making. In terms of the Debt-to-Equity ratio, Tesla stands in comparison with its top 4 peers, leading to the following comparisons:
- When considering the debt-to-equity ratio, Tesla exhibits a stronger financial position compared to its top 4 peers.
- This indicates that the company has a favorable balance between debt and equity, with a lower debt-to-equity ratio of 0.18, which can be perceived as a positive aspect by investors.
Key Takeaways
For Tesla, the PE, PB, and PS ratios are all high compared to industry peers, indicating overvaluation. However, Tesla’s high ROE, EBITDA, gross profit, and low revenue growth suggest strong operational performance relative to competitors in the Automobiles industry. This combination of high valuation multiples and strong operational metrics may present a mixed picture for Tesla compared to its industry peers.