Tesla Valuation at Risk as Autonomous Rivals Gain Ground
Tesla's Cybercab event was called 'largely a bust' by Gary Black, Managing Partner of The Future Fund. However, Black still believes that Tesla will achieve unsupervised autonomy with its Cybercab launch.
Black noted that Alphabet's Waymo led the market with more than 500,000 weekly autonomous rides in late August, ahead of Tesla and Amazon-backed Zoox. Since then, other companies have entered the space, combining for over 1 million weekly paid unsupervised autonomous rides without safety monitors.
Black expects self-driving to become the preferred option on ride-hailing apps like Uber as more providers enter the space.
Despite praising Tesla's technology, Black is cautious about its valuation. He noted that Tesla's price-to-earnings ratio of 213 times in 2026 and 158 times in 2027 are unusually high compared to its peers, with a PEG ratio of 6.3 times and 4.4 times respectively.
The gap between Tesla's valuation and its growth rate helps explain its underperformance versus the Nasdaq 100 and S&P 500 this year and over the past one, three, and five years.