Should Tesla be valued like a traditional automaker or a tech company?
That question has been at the center of a years-long debate between investors and skeptics of the electric vehicle maker, as bullish investors focus on its EV innovation, self-driving tech, and forays into solar and energy storage as reasons why Tesla deserves a premium valuation to traditional automakers.
What’s for sure is: if Tesla ever is valued like Ford or General Motors, it has a lot more room to decline, according to Greenwich Wealth Management chief investment officer Vahan Janjigian.
He told CNBC on Wednesday that even after plunging more than 60% in 2022, Tesla is still valued at about eight times more than Ford and General Motors — despite selling millions of fewer cars each year.
“Tesla I think is still tremendously overvalued despite its plunge this year… I think Tesla should be selling at a higher multiple than [Ford and General Motors] because it has much better growth prospects and they dominate the EV market. But this multiple is way too high,” Janjigian said.
