Tesla — Sum of the parts

A business with a revenue line is valued at the multiple its peers trade at; a business with none is valued as an option: pick a year it might exist (2030), build what it would earn, apply a multiple, bring the number back at 10% a year, and take off what it costs to build. Everything is taxed at 20%. An option that owns its units pays for them, and an option is never worth less than zero. A business already inside a filed line counts only for what it adds to that line.

Net cash is added once for the whole company; the carmaker peers are on price to sales, which already carries their own net cash, so on that line a little of it is counted twice — the page prefers that to an EV/sales that would carry their finance arms' debt. Each case divides by the shares that would exist in it: the CEO award's 423.7M shares vest only on its milestones, so only the bull case counts them.

Why these multiples. Automotive: bear 0.4× — GM's multiple: Tesla has GM's operating margin, 4%, and a shrinking credits line. base 0.7× — Toyota's multiple: the same gross margin on a far larger and steadier business. bull 1× — BYD's multiple: the one carmaker growing faster than Tesla. Energy: bear 1× — A storage integrator's multiple, between Fluence and SolarEdge. base 3× — Between the solar-electronics names and the power-equipment names, where a 29%-margin battery business belongs. bull 5× — A power-equipment multiple, GE Vernova's. Services: bear 0.3× — Half a dealer's multiple, for an 11% gross margin. base 0.6× — AutoNation's multiple. bull 1× — CarMax's multiple.

Why these builds. FSD software: Bear: Nothing added: today's subscribers are already inside the automotive line at its multiple, and unsupervised driving never comes to add more. Base: Half the award's 10 million, at today's $99 a month, on top of the line. Bull: The award's milestone, 10 million active subscriptions, at a price that has risen with capability. Robotaxi: Bear: Still a demonstration in 2030: an option that expired. Base: Half the award's 1 million milestone, three years later than the company's own timeline would put it; each car costs $30,000 to put on the road. Bull: The company's timeline, "millions" promised for 2026–27, carried to 2030: about a year and a half of today's car output, bought at $30,000 a car. Optimus: Bear: No product in 2030: an option that expired. Base: A tenth of the award's milestone. Bull: The award's milestone, 1 million bots delivered. Bots are sold, not owned, so the build carries no capital of its own.

Thesis v3, updated Sep 20, 2026: v3: each tier divides by the shares that would exist in it — the 423.7M-share award counts only in the bull tier; the robotaxi fleet pays for its cars, $30,000 each, taken off the option; the FSD bear tier is zero, since today's subscribers are already inside the automotive line and the option is the increment. Peers and price unchanged. The walk-through: Tesla, taken apart. The same question in one number: the reverse DCF for TSLA. Everything else: the TSLA summary.

What is a sum-of-the-parts valuation?

Split a company into its separate businesses, value each one on the multiples its own industry peers trade at, add the pieces up, and add net cash. It suits a company whose businesses are too different to be captured by a single multiple. This page does it in three tiers — bear, base and bull — and holds the sum against the market value of the shares.

How are businesses with no revenue valued?

As options: pick a year when the business might exist, build what it would earn from a few stated inputs, apply a multiple, bring the number back to today at a required return, and take off what it costs to build. Each tier is a different set of inputs, all printed. A bear tier of zero means the option is assumed to expire, and an option is never worth less than zero.

What does working backwards mean here?

Every part is held at its base value except one, and the page solves for the size that one part would have to reach for the sum to equal the price. It turns the price into a single number about the future that can be checked against the company's own reports.

Can I change the inputs?

Yes. The controls edit the base tier — multiples on the filed lines, the target-year build of each option, the required return — and every figure on the page re-draws. Bear and bull stay as published, so you are always moving one bar against two fixed ones.