Michael Burry Says Tesla Is 'Ridiculously Overvalued' After Earlier Warning About The Elon 'Cult'

Core Viewpoint - Investor Michael Burry has expressed concerns about Tesla Inc.'s valuations, labeling the company as "ridiculously overvalued" due to its declining sales momentum [2][4]. Sales Performance - Tesla's projected vehicle sales for the fourth quarter are estimated at 422,850 units, which is 14.93% lower than the previous quarter and down 15% compared to the same period last year [2]. - The company is on track for its second consecutive annual decline in vehicle sales, with average estimates at 1,640,752 units, reflecting an 8.8% decrease from just under 1.8 million global deliveries in 2024 [3]. Market Valuation - Despite the declining sales, Tesla remains the most valuable automaker globally, with a market capitalization of $1.53 trillion, trading at 204 times forward earnings, significantly higher than the industry average price-to-earnings ratio of 17.47 [3]. Shareholder Concerns - Burry has criticized Tesla's CEO Elon Musk's compensation package, warning that it could lead to stock dilution, as the company dilutes its shareholders by 3.6% annually without any stock buybacks [4]. - Burry noted the shift in Tesla's focus from electric cars to autonomous driving and now to robotics, suggesting that competition may impact these areas as well [5]. Unusual Communication - It is considered "very unusual" for Tesla to issue a press release with quarterly sell-side consensus estimates, as noted by fund manager and Tesla analyst Gary Black [6].