Tesla: Time To Pull The Plug

Tesla, Inc. reported record Q2 deliveries and revenue, but margins collapsed and free cash flow turned negative for the first time in two years. TSLA plans over $25 billion in CapEx this year and is pursuing up to $30 billion in debt capacity, signaling a major shift in funding strategy. Competitive pressures are intensifying in Europe, China, and the U.S., while recent demand was likely boosted by temporary geopolitical factors. My updated DCF model yields a fair value of $91.95 per TSLA share—about 70% below current levels—supporting a bearish stance despite some positive demand signals. A month ago, I argued that Tesla, Inc. (TSLA) had become one of the biggest disconnects between price and fundamentals that the market has ever produced. Since that time, the shares have declined by ~27%.