Tesla, Inc. (TSLA): investment thesis checklist
What a value investor writing down why they own Tesla, Inc. would be relying on, read from its filings: the figures that have carried the business, the lines a reader might set on them, and the published tests it meets today. A list to write against, not a view on the company.
1. The figures the case would rest on
- Return on invested capital: 4.0% in FY2025; between 4.0% and 36.6% over 5 filed years, median 9.3%. Does the thesis need it to stay inside that range?
- Return on equity: 4.6% in FY2025; between -46.3% and 28.1% over 10 filed years, median 3.9%. Does the thesis need it to stay inside that range?
- Free cash flow yield: 0.4% in FY2025; between -6.7% and 1.8% over 10 filed years, median 0.4%. Does the thesis need it to stay inside that range?
- EV to EBIT: 363.91x in FY2025; between 30.58x and 380.18x over 6 filed years, median 190.40x. Does the thesis need it to stay inside that range?
- Price to earnings: 416.41x in FY2025; between 34.03x and 1120.10x over 6 filed years, median 207.04x. Does the thesis need it to stay inside that range?
- Gross margin: 18.0% in FY2025; between 16.6% and 25.6% over 10 filed years, median 18.9%. Does the thesis need it to stay inside that range?
- Operating margin: 4.6% in FY2025; between -13.9% and 16.8% over 10 filed years, median 5.5%. Does the thesis need it to stay inside that range?
- Net debt to EBITDA: -0.19x in FY2025; between -1.73x and 6.41x over 7 filed years, median -0.56x. Does the thesis need it to stay inside that range?
- Revenue growth, 5-year CAGR: 24.6% in FY2025; between 24.6% and 102.8% over 10 filed years, median 50.4%. Does the thesis need it to stay inside that range?
- Share count change: 0.9% in FY2025; between 0.3% and 22.1% over 9 filed years, median 2.8%. Does the thesis need it to stay inside that range?
2. What must stay true: guardrails a reader might set
Each line is drafted from Tesla, Inc.'s own current figure, never from a level we think a business should clear, and replayed over its filed years. They are a reader's to keep, edit or drop.
Debt to Equity stays at or below 0.22x
Today 0.18x. Replayed over 7 filed years, it would have broken in 3; most recently FY2021, at 0.29x (10-K, filed 2022-02-07).
Current Ratio stays at or above 1.73x
Today 2.16x. Replayed over 10 filed years, it would have broken in 6; most recently FY2022, at 1.53x (10-K, filed 2023-01-31).
Return on Invested Capital stays at or above 3.17%
Today 3.96%. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
3. What would break it
- A filed year in which debt to equity rose above 0.22x.
- A filed year in which current ratio fell below 1.73x.
- A filed year in which return on invested capital fell below 3.17%.
4. The published tests it meets today
Of 30 tests value investors published: 1 met, 28 not met, 1 we could not complete. Counts, never a score.
Meets: Z-score and coverage (Edward Altman).
What this cannot tell you
What the numbers say today, not the day one stops being true. The reasons are not written down.
An account adds
One email the night a number you wrote down breaks. Silence otherwise.
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How this is computedA computation on accounts filed with the SEC, not a recommendation and not advice. Past filings do not indicate future results. Risk disclaimer.