Michael Burry Calls Tesla ’Ridiculously Overvalued’ Amid Earnings Decline
Michael Burry, the investor renowned for predicting the 2008 financial crisis, has labeled Tesla as "ridiculously overvalued" in a recent Substack post. The automaker's stock trades at over 250 times earnings, a stark contrast to the S&P 500 average of 26. Tesla's Q3 results revealed a 37% drop in net income, with gross margins slipping from 19.8% to 18% due to intensifying competition from Chinese rivals.
Burry, who previously shorted $530 million worth of Tesla shares in 2021, criticized the company's $1.5 trillion market capitalization and Musk's $1 trillion pay package as unsustainable. Analyst consensus suggests a potential 15% correction for Tesla stock, which currently hovers NEAR $479 per share.