When Tesla (TSLA) posted first-quarter results, shares pulled back. It closed at around $376 last week, after shareholders did not respond well to CEO Elon Musk’s many promises. Those include the production start of Cybercab.
Heavy Investments in 2026
Tesla will embark on heavy capital expenses this year. The CEO said that the company will increase its investments for its future. Significant capex will lay the groundwork for an increase in manufacturing and production.
Tesla plans to start production of its self-driving (with driver assistance) Cybercab. Secondly, its semi-truck production will start soon. Furthermore, the initial output starts slowly. Musk reasoned that a new product starts involving a completely new supply chain. In time, it ramps up. He targeted the production ramp-up toward the year-end 2026 to 2027 timeframe.
Musk did not know if unsupervised FSD/robotaxi operations would happen by the end of this year. He expressed caution that robotaxi revenue would not be material to results. That removed the “hype” valuation on TSLA stock, albeit minimally. TSLA stock trades at a P/E of around 340 times. The price/sales ratio is nearly 15 times. By comparison, General Motors (GM) trades at a forward P/E that is below 6 times. Its P/S is below 0.4 times.
Value investors might consider Ford Motor (F). In addition, Toyota’s (TM) dip sent the stock down by 11.45% last week. Honda (HMC) also traded near its 52-week low.
