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In the dynamic and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Tesla (NASDAQ:TSLA) 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's performance within the industry.
Tesla is a vertically integrated battery electric vehicle automaker and developer of autonomous driving software. The company has multiple vehicles in its fleet, which include luxury and midsize sedans, crossover SUVs, a light truck, and a semi-truck. Tesla also plans to begin selling more affordable vehicles, and a sports car. Global deliveries in 2023 were a little over 1.8 million vehicles. The company also 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.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Tesla Inc | 45.39 | 8.79 | 6.54 | 1.84% | $2.88 | $3.7 | -8.69% |
| Toyota Motor Corp | 8.79 | 1.27 | 0.96 | 2.99% | $2184.65 | $2250.19 | -8.04% |
| General Motors Co | 5.58 | 0.78 | 0.34 | 4.54% | $6.73 | $5.91 | 7.58% |
| Honda Motor Co Ltd | 7.41 | 0.64 | 0.40 | 1.92% | $596.45 | $1150.38 | 0.73% |
| Ford Motor Co | 12.53 | 1.13 | 0.28 | 3.11% | $3.41 | $3.6 | 3.14% |
| Li Auto Inc | 13.26 | 2.47 | 1.16 | 0.98% | $0.7 | $5.28 | 36.44% |
| Thor Industries Inc | 19.70 | 1.29 | 0.51 | 2.88% | $0.23 | $0.42 | -4.36% |
| Winnebago Industries Inc | 17.44 | 1.32 | 0.62 | -0.95% | $0.01 | $0.11 | -18.82% |
| Fly-E Group Inc | 78.04 | 15.87 | 3.30 | 0.34% | $0.0 | $0.0 | 66.0% |
| Average | 20.34 | 3.1 | 0.95 | 1.98% | $349.02 | $426.99 | 10.33% |
By conducting a comprehensive analysis of Tesla, the following trends become evident:
The current Price to Earnings ratio of 45.39 is 2.23x higher than the industry average, indicating the stock is priced at a premium level according to the market sentiment.
With a Price to Book ratio of 8.79, which is 2.84x the industry average, Tesla might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
With a relatively high Price to Sales ratio of 6.54, which is 6.88x the industry average, the stock might be considered overvalued based on sales performance.
The company has a lower Return on Equity (ROE) of 1.84%, which is 0.14% below the industry average. This indicates potential inefficiency in utilizing equity to generate profits, which could be attributed to various factors.
With lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $2.88 Billion, which is 0.01x below the industry average, the company may face lower profitability or financial challenges.
The company has lower gross profit of $3.7 Billion, which indicates 0.01x below the industry average. This potentially indicates lower revenue after accounting for production costs.
The company is witnessing a substantial decline in revenue growth, with a rate of -8.69% compared to the industry average of 10.33%, which indicates a challenging sales environment.
The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative to its equity.
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.
By analyzing Tesla in relation to its top 4 peers based on the Debt-to-Equity ratio, the following insights can be derived:
Tesla has a stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.15.
This suggests that the company has a more favorable balance between debt and equity, which can be perceived as a positive indicator by investors.
For Tesla, the PE, PB, and PS ratios are all high compared to industry peers, indicating a potentially overvalued stock. The low ROE suggests lower profitability compared to competitors, while the low EBITDA and gross profit levels also raise concerns about operational efficiency. Additionally, the low revenue growth rate may indicate challenges in expanding market share.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
Posted In: TSLA
