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Tesla’s Market Performance
Shares of Tesla (NASDAQ: TSLA) rose approximately 70% over the past year, boosting its market capitalization to nearly $1.5 trillion. Despite this surge, the stock is approaching its all-time high of $479.86 and maintains a high price-to-earnings (P/E) multiple of over 300, significantly above the S&P 500 average of 26.
Q3 Financial Results
On October 22, Tesla reported its Q3 2025 results, revealing revenues of $28.1 billion, which exceeded analyst expectations of $26.37 billion. However, the adjusted earnings per share of $0.50 fell short of the anticipated $0.54, and its gross margin decreased from 19.8% to 18% year-over-year. Net income was $1.4 billion, down 37% compared to the previous year.
Outlook and Analyst Consensus
Analysts suggest that Tesla’s stock may undergo a correction of at least 15% from current levels, indicating growing concerns about its high valuation amidst rising competition and declining earnings growth. The consensus price target stands at $381, reinforcing skepticism about its current pricing despite its popularity among retail investors.
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