① Hedge fund manager George Noble warned that Tesla’s stock has a significant bubble, which investors have not paid sufficient attention to; ② Noble believes that Tesla’s fundamentals are disconnected from its valuation, and its stock price should be between $60 and $140 per share, representing an approximately 87% decline from the current price.
Cailian Press, January 26 (Editor Huang Junzhi) Since the second half of last year, Tesla’s stock price has been quite strong. Optimistic investors see it not merely as an automobile company but focus more on its progress in robotics and autonomous driving. However, hedge fund manager and former Fidelity Investments fund manager George Noble does not agree with the bullish perspective. He warned that Tesla’s stock represents a massive equity market bubble, and investors are inadequately aware of this.
In his latest interview, he elaborated on his bearish stance, explaining why he is shorting the company and what aspects investors should focus on. If this seasoned investor’s forecast proves accurate, Tesla’s stock could face a turbulent period.
Noble’s core argument against Tesla is that its fundamentals are disconnected from the premium valuation of its stock. He pointed out that the competition in relevant fields is extremely fierce and mentioned that Tesla’s sales revenue for 2025 will decline for the second consecutive year.
“I think this (Tesla) might be the biggest bubble in the history of the stock market,” he said. “In my view, no other stock is as disconnected from fundamental valuations as Tesla.”
Noble believes that, based on Tesla’s current fundamentals, its stock price should fluctuate between $60 and $140 per share. If calculated based on the lowest value, the stock would need to drop by about 87% from Friday’s closing price.
In his view, media hype has played a much greater role in boosting Tesla’s stock price compared to its business success relative to its fundamental performance.
“(Tesla’s) product isn’t cars, but stocks and stories. He (Musk) keeps jumping from one story to another. A few years ago, it was solar energy, then he founded The Boring Company (a tunnel construction firm). He also promised to launch self-driving taxis within a decade.” He added.
Noble noted that among all of Musk’s statements, one particularly concerning point is, “Tesla is not just a car company,” a view shared by many on Wall Street.
He believes that despite Musk’s high hopes for self-driving taxis and humanoid robots, the majority of Tesla’s revenue still comes from car sales, which have been declining over the past two years.
Noble also noted in a recent blog post: ‘Automotive-related business accounts for 87% of the company’s revenue but faces significant challenges, with sales expected to decline for the third consecutive year by 2026. Based on comparative valuation, the per-share value of the automotive business is only USD 20.’
Noble is not the only investor expressing concerns about Tesla’s valuation. Porter Collins, the real-life prototype from the movie ‘The Big Short’ and a well-known trader, also believes that Tesla’s stock is a quintessential example of being ‘severely overvalued.’
According to Collins, Tesla’s stock price has nearly doubled since reaching a bottom in April of last year. However, these gains have occurred amidst declining sales.
‘Tesla is no longer the world’s largest electric vehicle manufacturer,’ he stated earlier this January.
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