Despite the ups and downs, Tesla’s (NASDAQ: TSLA) long-term share price performance is noteworthy. Over the past decade, the stock has surged by 1,790%. A $1,000 investment made in May 2015 would be worth $18,910 today.

This growth has solidified Tesla’s position as one of the most valuable companies globally. However, with the stock currently 38% below its peak, some investors may wonder if now is the time to buy the dip.

Should you invest $1,000 in Tesla shares today with a long-term outlook?

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A Bumpy Road Ahead

Tesla deserves recognition for its rapid ascent. The company’s intense focus on technology, innovation, and manufacturing has transformed the auto industry, establishing a strong global brand. Tesla effectively launched the electric vehicle (EV) market as we know it, driving up its stock price over the years.

However, the landscape has shifted. The days of extraordinary growth for Tesla appear to be behind it. Currently, the company faces significant challenges in maintaining profitability.

In the first quarter of 2025, Tesla’s vehicle sales dropped 20% year-over-year, resulting in $14 billion in revenue. This decline partly stems from reduced production as factories retooled for the updated 2025 Model Y. Increased competition has also forced lower selling prices, contributing to these struggles.

Additionally, Tesla’s operating income fell by 66% during this quarter, highlighting its difficulties in a tightening market. Rising interest rates further complicate the situation, making it harder for consumers to afford new vehicles.

Given these factors, investors should not expect Tesla to replicate its past extraordinary growth. Analysts anticipate a revenue increase of only 13.4% annually from 2024 to 2027, a marked decline compared to previous years.

Betting on Musk’s Vision

Only those with strong faith in Elon Musk’s long-term vision for Tesla should consider purchasing shares now. There is the possibility that in 20 years, the company could generate substantial revenue and free cash flow. Supporters hope for this outcome.

This outlook hinges on Tesla’s ability to deliver improved autonomous vehicle technology. The rollout of its robotaxi service in Austin, Texas, next month will be the first step, with plans to expand across the U.S. by year’s end.

However, the path to establishing a robust robotaxi fleet is fraught with challenges. Different markets have varying regulations that must be navigated. Additionally, significant technical hurdles related to fully self-driving vehicles remain. Perhaps most daunting is garnering consumer trust in vehicles without drivers.

Investors currently value Tesla at a price-to-earnings ratio of 164, indicating high expectations for future growth amidst present financial challenges. This valuation might be reasonable only for those who believe strongly in its long-term prospects.

While few businesses endeavor to push boundaries like Tesla, the uncertainty surrounding its future is considerable. Given the current realities and lofty valuation, a cautious approach may be wise—investors might be better off avoiding Tesla at this time.