How Tesla Stock Gained 50%
Tesla (TSLA)’s stock soared 51%, fueled by a striking 83% jump in its P/E multiple—even as revenue slipped and margins tightened. What’s behind this puzzling surge? A mix of earnings misses, shifting market tides, fading tax credits, stiff competition, and bold moves in AI and robotaxis. Let’s dive in.
Below is an analytical breakdown of stock movement into key contributing metrics.
| 4262025 | 1212026 | Change | |
|---|---|---|---|
| Stock Price ($) | 284.9 | 431.4 | 51.4% |
| Change Contribution By | LTM | LTM | |
| Total Revenues ($ Mil) | 95,724.0 | 95,633.0 | -0.1% |
| Net Income Margin (%) | 6.4% | 5.3% | -16.8% |
| P/E Multiple | 150.2 | 274.1 | 82.6% |
| Shares Outstanding (Mil) | 3,218.0 | 3,227.0 | -0.3% |
| Cumulative Contribution | 51.4% |
So what is happening here? The stock jumped 51%, driven by an 83% surge in its P/E multiple, despite slight revenue dip (-0.1%) and a 17% margin decline. Let’s explore the events behind these shifts next.
Here Is Why Tesla Stock Moved
- Q2 2025 Earnings Miss: Tesla missed Q2 2025 earnings expectations, with EPS and revenue down due to tariffs.
- Q3 2025 Mixed Results: Q3 2025 saw record deliveries and revenue, but GAAP EPS missed estimates, and margins declined.
- EV Tax Credit Expiry: The end of the $7,500 US EV tax credit in Q3 2025 impacted Q4 sales volumes and margins.
- Increased Competition: BYD surpassed Tesla in 2025 EV deliveries, and Tesla’s market share slipped in California.
- AI & Robotaxi Progress: Optimism grew from Robotaxi launch in June 2025 and advancements in Full Self-Driving.
Our Current Assesment Of TSLA Stock
Opinion: We currently find TSLA stock unattractive. Why so? Have a look at the full story. Read Buy or Sell TSLA Stock to see what drives our current opinion.
Risk: To get a sense of TSLA’s risk, check out its drops during major market shocks. It fell about 54% in the 2018 correction, 61% during the Covid crash, and nearly 74% in the inflation shock. These aren’t minor dips. Even with strong growth and buzz, TSLA can take serious hits when markets turn. It shows that no matter the positives, big sell-offs can hit even popular names hard.
TSLA stock may have seen strong gains recently, but investing in a single stock without detailed, thorough analysis can be risky. The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 — the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.