<div id="readability-page-1">On one level, the optimism around Tesla (NASDAQ:TSLA) stock is pretty easy to understand. After all, the company's big bets on autonomous driving and humanoid robots are rooted in the pursuit of potentially trillions of dollars in future opportunities.<h3>Claim 70% Off TipRanks Premium</h3><ul><li>Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions </li><li> Stay ahead of the market with the latest news and analysis and maximize your portfolio's potential</li></ul> In that light, drooping EV sales in the here and now haven't raised too many alarm bells. TSLA's share price continues to enjoy high valuation premiums – ones that are head and shoulders above those of other automobile manufacturers – even after two straight years of falling deliveries. Tesla's latest Q4 deliveries update is a prime example of this phenomenon. Deliveries slid 15.6% year-over-year to 418,227 vehicles, yet the stock remains comfortably above $440 – a sign that investors are still willing to look past today's delivery slowdown and bet that Elon Musk's long-term autonomy vision will ultimately outweigh current fundamentals. However, top investor Daniel Sparks isn't so confident such a lucrative future awaits the company and its investors. &#34;What if Tesla's Robotaxi service turns out to be a costly and commoditized business?&#34; asks the 5-star investor, who is among the top 1% of stock pros covered by TipRanks. Sparks lays out two main concerns. The first revolves around Tesla's capital expenditures, which were close to $9 billion in 2025. The investor cites recent statements from the company's CFO, who acknowledged that Tesla's capex is expected to &#34;increase substantially&#34; in 2026. Sparks worries that these costs could balloon even higher than investors are expecting. The second issue the investor raises is the profitability of the future robotaxis, which Sparks points out is going to be competing in &#34;a highly competitive, price-sensitive market.&#34; He notes that large tech giants (Alphabet and Amazon), EV makers (Rivian, Lucid, and BYD), and existing ride-sharing companies (Uber and Lyft) are all racing to offer their own autonomous driving services. In other words, rather than pushing the boundaries of technological advancements, the full self-driving market could find itself turning into something resembling a commodity. Viewed in that light, the margins might not be all that attractive. &#34;Intuitively, a taxi service boils down to price when customers select their rides. So, it may be difficult for one company to differentiate itself on any factor other than price,&#34; adds Sparks. Ultimately, that doesn't leave enough margin for Sparks to feel comfortable with an investment in Tesla. &#34;I believe the bull case for Robotaxi is largely priced in, and the bear case is mostly ignored,&#34; concludes Sparks. (To watch Sparks' track record, click here) Wall Street's stance reflects that tension. While 13 analysts are willing to give Elon Musk the benefit of the doubt, 10 remain on the sidelines and 7 recommend selling, resulting in a consensus Hold (i.e., Neutral) rating. Meanwhile, the Street's 12-month average price target of $405.94 implies a downside of high single digits from current levels. (See TSLA stock forecast) </div>

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Top investor Daniel Sparks advises against investing in Tesla (NASDAQ:TSLA) stock, citing concerns over high capital expenditures and the competitive nature of the future Robotaxi market. Despite Tesla's current high valuation and optimism surrounding autonomous driving, Sparks warns that the profitability of Robotaxis may be compromised due to competition from major tech and EV companies. Wall Street analysts show mixed sentiments, with a consensus Hold rating and a 12-month price target suggesting potential downside for the stock.

- Tesla's stock optimism stems from its ventures into autonomous driving and humanoid robots, despite a 15.6% drop in Q4 deliveries.  
- Investor Daniel Sparks raises concerns about Tesla's rising capital expenditures and the potential for its Robotaxi service to become a commoditized market, impacting profitability.  
- Wall Street analysts display mixed sentiments, with a consensus Hold rating and an average price target suggesting a potential decline in stock value.

'Don't Bet On It,' Says Top Investor About Tesla Stock