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Why I Wouldn’t Buy Tesla Stock

Written By

Dan Buckley

Written By

Dan Buckley

Head Market Analyst

Dan Buckley is an US-based trader, consultant, and analyst with a background in macroeconomics and mathematical finance. As DayTrading.com's chief analyst, his goal is to explain trading and finance concepts in levels of detail that could appeal to a range of audiences, from novice traders to those with more experienced backgrounds. Dan's insights for DayTrading.com have been featured in multiple respected media outlets, including the Nasdaq, Yahoo Finance, AOL and GOBankingRates.

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Edited By

James Barra

Edited By

James Barra

Head of Content and Media Lead

James is Head of Content and a brokerage expert with a background in financial services. A former management consultant, he's worked on major operational transformation programmes at top European banks. A trusted industry name, James's work at DayTrading.com has been cited in publications like Business Insider.

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Fact Checked By

William Berg

Fact Checked By

William Berg

Head Legal Analyst & Securities Law Expert

William contributes to several investment websites, leveraging his experience as a consultant for IPOs in the Nordic market and background providing localization for forex trading software. William has worked as a writer and fact-checker for a long row of financial publications.

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Updated

Feb 16, 2026

This article was first published on June 4, 2025

Tesla’s robotaxi and humanoid bot ambitions might excite headlines, but investors are still paying venture-capital prices for a public company.

Its valuation is effectively a call option on a highly uncertain future – where demand for these emerging technologies, Tesla’s ability to execute on them, and the economics of production all remain unproven – as well as highly regulated and capital-hungry.

In the short run, the financialization of the stock also propels its volatility: options turnover commonly averages hundreds of billions a day, often exceeding the rest of the S&P 500 combined and pulling passive funds along with it.

Musk’s relative level of involvement in politics is largely a sideshow to the reality that Tesla’s stock already embeds around $1 trillion in narrative-driven valuation untethered from current fundamentals.

Bottom line: buying Tesla here means betting its moonshots scale relatively fast enough to justify an exuberant valuation – with the embedded pricing implying large upside if they land (and, importantly, if such demand/profits flow to Tesla), but very little margin of safety if they don’t.