17 Dec 2025, 05:38 PM IST i Musk’s other initiatives include a potential initial public offering of rocket and satellite maker SpaceX, a business he said has been converging with Tesla. Sentiment about autonomous cars also is likely to be boosted by Waymo, Alphabet Inc.’s autonomous self-driving unit, holding discussions to raise more than $15 billion at a valuation near $100 billion. “It’s clearly SpaceX: the beauty of Tesla is that retail investors amalgamate everything,” said Jacques Aurelien Marcireau, co-head of equities at Edmond de Rothschild Asset Management. “Investors tend to leverage Tesla as a proxy for the Musk Galaxy despite the very low real linkage in terms of economic interest.” Still, Tesla faces several hurdles in its business outlook. The company’s sales in California are poised to be suspended for 30 days if it doesn’t change marketing practices that allegedly mislead consumers about its driver-assistance technology. Meanwhile, the latest quarterly results disappointed investors as rising costs undermined a record quarter for vehicle sales. Karen Kharmandarian, senior equity investment manager at Thematics AM, said Tesla’s lofty valuations also reflect any positive news in the short term. The stock trades at a whopping 223 times forward earnings, well above a five-year average of 94, according to data compiled by Bloomberg. The broader Bloomberg Magnificent Seven Index carries a price-to-earnings valuation of 31. “I’m definitely not a buyer: the multiples are just crazy with earnings that keep on disappointing,” said Fares Hendi, portfolio manager at Societe de Gestion Prevoir. ALSO READ