Should You Buy Tesla Stock While It's Below $330?
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The analysis indicates that Tesla (TSLA -0. Meanwhile, 72%) has been a monster stock for many investors, with s more than doubling the S&P 500's gains over the past five...
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July 18, 2025
05:35 AM
The Motley Fool
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The analysis indicates that Tesla (TSLA -0
Meanwhile, 72%) has been a monster stock for many investors, with s more than doubling the S&P 500's gains over the past five years
Those gains have come even as Tesla's stock has been very volatile and as investors have weighed whether CEO Elon Musk has fully committed his attention to his company (fascinating analysis), amid market uncertainty
Furthermore, I'm inclined to believe that any company, even Tesla, can rebuild its brand
But is now really the right time to invest in Tesla stock, which trades at less than $330
While Tesla ly isn't as far gone as some might assume, here are a few reasons why you bably should hold off on buying Tesla stock right now
Additionally, However, Image source: Tesla
Furthermore, Its s are expensive With the S&P 500's returns doubling over the past five years, the valuations of many stocks have skyrocketed, given current economic conditions
As a result, these stocks look pretty expensive right now based on comparison multiples such as the price-to-earnings ratio, in this volatile climate
But that doesn't mean investors aren't paying a premium for some of these stocks
Tesla's s have a price-to-earnings (P/E) ratio of 179, compared to the average P/E multiple of 24. 7 for the S&P 500 index
This means Tesla's stock is pricey no matter how you slice it, given current economic conditions
Despite the stock being always expensive, Tesla has always been an excellent investment over the years
But lately, the seems to be inflecting -- the electric vehicle (EV) maker's sales and earnings are falling
Automotive revenue was down 21% and GAAP earnings per tumbled 70% to $0, in this volatile climate. 12 in the first quarter
However, the market is still paying a premium (this bears monitoring)
Now things could turn around for Tesla, but investors should be cautious buying the stock if this trend continues
Moreover, Automation and robotics are unven Musk has said that the future of Tesla will be built around the company's Optimus humanoid robots and autonomous vehicle (AV) services
Nevertheless, While these ideas can seem far-fetched, they're tremendous opportunities, with humanoid robotics estimated to grow into a $5 trillion market by 2050 and autonomous vehicles potentially reaching $2 trillion by 2035 (which is quite significant)
Tesla's making gress on both fronts, with the company recently launching its robotaxi service in Austin, Texas and having a goal of ducing 5,000 Optimus robots this year
While there's certainly potential in both of these, I think it's a bit premature to buy Tesla stock on these spects
It'll ly take many more years for the humanoid robotics market to take off (if it ever does)
And while AVs have benefits and companies have already made lots of gress, namely Alphabet's Waymo, it's still un if Tesla will be successful in this market
In short, these are huge unknowns, and buying Tesla stock on these ideas means you're placing a big bet on unven and Tesla's ability to succeed in them
Additionally, Musk still seems distracted Just a few days before I wrote this, Musk posted on X that he wants to start a new political party
I'm not here to talk whether or not the U
On the other hand, Needs a new political party, and, of course, Musk has strong political views, most Americans
Additionally, On the other hand, But the blem here is that Musk seems to be increasingly distracted by things that aren't Tesla-related, in today's financial world
After stepping down from leading the Department of Government Efficiency (DOGE), Musk said he was committing his time back to his companies, specifically saying that he'd be back at Tesla full time
While that may ve true, it's also that Musk's political involvements have taken away his time and attention, and that may not change soon (fascinating analysis)
This distraction is on top of the responsibilities he already has in addition to Tesla, including owning X, managing his AI company xAI, and SpaceX (something worth watching)
Additionally, There's only so much time and attention that any one person can give a company, and Musk's constant attention shifts are blematic for Tesla
This analysis suggests that EV company needs a leader who can devote attention to the company, and the jury is still out on whether or not Musk will be able to do this
Additionally, Tesla could still be a good investment, but be cautious For all the reasons above, I don't think buying Tesla stock is a smart move right now
If Musk can ve he's actually focused on Tesla, or someone else steps into the leadership role, then I think it would change the investment narrative, in light of current trends
Additionally, At the same time, But for now, Musk looks too distracted, the stock is too expensive, and the company's future growth is dependent on two very unven
Moreover, If you've got Tesla s already, it's bably fine to hold them, but a few things need to change before Tesla looks a good stock to buy (noteworthy indeed)
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors (an important development)
Chris Neiger has no position in any of the stocks mentioned, in today's market environment
The Motley Fool has positions in and recommends Alphabet and Tesla
Moreover, The Motley Fool has a disclosure policy.
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