<div id="readability-page-1"><div><div><p><strong>Gary Black</strong>, Future Fund LLC’s managing director and a prominent market analyst, has expressed concerns about <strong>Tesla Inc</strong>.’s <span>TSLA</span> high forward price-to-earnings (P/E) ratio, questioning the sustainability of its current valuation.</p><p><strong>What Happened</strong>: In a detailed thread on X on Saturday, Black pointed out that Tesla’s forward P/E ratio stands at a staggering 180x. He noted that no trillion-dollar market cap company in stock market history has traded at such a high forward P/E ratio. </p><p>Black argued that the long-term growth rate required to justify such a P/E would make Tesla’s market cap larger than <strong>Apple Inc.</strong> <span>AAPL</span> and <strong>Microsoft Corp.</strong> <span>MSFT</span>, which he deemed “insane.”</p><p>“The long-term growth rate needed to justify a 180x P/E would cause TSLA market cap to be bigger than $AAPL and $MSFT, which seems insane since both have huge TAMs, unassailable brands, and highly predictable future cash flow streams,” he said in the post. </p><p>Also Read: Gary Black Says Tesla’s Robotaxi Launch In June Poses Minimal Risk To Uber: ‘Will Offer Low-Cost…’</p><p>Black criticized Tesla bulls who dismiss his argument by claiming that the 2025 P/E is irrelevant. He emphasized that a stock’s valuation is the present value of all future cash flows, discounted back at a risk-adjusted cost of capital, plus net cash. To disregard P/E, according to Black, is equivalent to ignoring valuation when making an investment decision.</p><p><strong>Latest Startup Investment Opportunities</strong>:</p><div><div><div><div><div><div><ul><li><div><div><p><span><img src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/06125138/IMG_5682-edited.jpeg/query-YXV0bz13ZWJwJmF1dG89d2VicCZkcHI9MSZkcHI9MiZvcHRpbWl6ZT1tZWRpdW0md2lkdGg9MTA4MD9vcHRpbWl6ZT1tZWRpdW0md2lkdGg9Mzg0MA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="1000" height="563" original-src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/06125138/IMG_5682-edited.jpeg/query-YXV0bz13ZWJwJmF1dG89d2VicCZkcHI9MSZkcHI9MiZvcHRpbWl6ZT1tZWRpdW0md2lkdGg9MTA4MD9vcHRpbWl6ZT1tZWRpdW0md2lkdGg9Mzg0MA"/></span></p></div><div><div><p><span></span></p><div><div><div><p><span>Min. Investment</span><span>$1,000</span></p><p><span>Industry</span><span>AI</span></p></div></div></div>Get Offer <p></p></div></div></div></li><li><div><div><p><span><img src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/12011752/Screenshot-2025-01-11-at-10.17.30%E2%80%AFPM.jpg/query-YXV0bz13ZWJwJmRwcj0yJm9wdGltaXplPW1lZGl1bSZ3aWR0aD0zODQw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="7680" height="4130" original-src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/12011752/Screenshot-2025-01-11-at-10.17.30%E2%80%AFPM.jpg/query-YXV0bz13ZWJwJmRwcj0yJm9wdGltaXplPW1lZGl1bSZ3aWR0aD0zODQw"/></span></p></div><div><div><p><span></span></p><div><div><div><p><span>Min. Investment</span><span>$974</span></p><p><span>Industry</span><span>Tech</span></p></div></div></div>Get Offer <p></p></div></div></div></li></ul></div></div></div></div></div></div><p>“TSLA bulls who pretend they understand finance dismiss my argument that TSLA's valuation looks stretched by saying the 2025 P/E is irrelevant. Rule #1 in investing is buy low, sell high. Rule #2 is price is what you pay, value is what you get. Arguing that P/E doesn't matter to an investment decision tells me the person doing the arguing has no valuation discipline and is just buying concepts, rather than on some assessment of value vs price,” Black continued. </p><p><strong>Why It Matters</strong>: Black’s comments come at a time when Tesla’s stock has been under scrutiny due to its high valuation. Despite the company’s impressive growth, some investors and analysts have raised concerns about whether its current stock price accurately reflects its future earnings potential. </p><p>Black’s argument adds to this ongoing debate, highlighting the importance of traditional valuation metrics like P/E in assessing a company’s worth.</p><p>While Black clarified that he doesn’t foresee a situation where he would short Tesla, his comments underscore the need for investors to exercise caution and conduct thorough valuation assessments before making investment decisions.</p><ul> <li>Elon Musk's Long-Time Lieutenant Exits DOGE As Tesla CEO Steps Down From Government Work: Staffers At Agency Surprised</li> </ul><p>Image: Shutterstock/bluestork</p></div></div></div>

TSLA

<p>Gary Black, managing director of Future Fund LLC, has raised concerns about Tesla's high forward P/E ratio of 180x, arguing that such a valuation would require an unsustainable long-term growth rate, potentially exceeding that of Apple and Microsoft. He criticized Tesla supporters for dismissing the relevance of P/E ratios in investment decisions, emphasizing the importance of traditional valuation metrics. Black's comments highlight the ongoing debate regarding Tesla's stock price and its reflection of future earnings potential, urging investors to conduct thorough assessments before investing.</p>

- Gary Black, managing director of Future Fund LLC, raised concerns about Tesla Inc.'s high forward price-to-earnings (P/E) ratio of 180x, questioning its sustainability.  
- He argued that such a valuation would require an unrealistic long-term growth rate, potentially exceeding the market caps of Apple Inc. and Microsoft Corp.  
- Black emphasized the importance of traditional valuation metrics, cautioning investors to conduct thorough assessments before making investment decisions.

Gary Black Questions Tesla's Sky-High Forward P/E Ratio: 'Long-Term Growth Rate Needed To Justify a 180X P/E Would Cause Tsla Market Cap To Be Bigger'