What are TSLA's current financial ratios indicating?

Tesla's (TSLA) current financial ratios suggest a mixed signal for the company's financial health and performance: 1. **High Valuation Ratios**: - The P/E ratio of 160.94 indicates that the stock is significantly overvalued relative to its earnings. - The P/S ratio of 10.53 and P/B ratio of 12.63 also point to a premium valuation by the market. 2. **Low Profitability Ratios**: - The net margin of 3.85% and operating margin of 4.63% indicate relatively low profitability. - The ROA of 1.22%, ROE of 2.1%, and ROIC of 1.91% suggest inefficient use of assets, equity, and capital to generate profits. |code|Ticker|Name|Date|ROA|ROE(Average)|market_code| |---|---|---|---|---|---|---| |TSLA|TSLA.O|Tesla|2024 Q3|4.7256|7.2025|185| |TSLA|TSLA.O|Tesla|2024 Q4|6.7962|10.4628|185| |TSLA|TSLA.O|Tesla|2025 Q1|0.2266|0.5543|185| |TSLA|TSLA.O|Tesla|2025 Q2|1.2153|2.1048|185| |code|Ticker|Name|Date|P/E(TTM)|P/S|Price to Book Ratio|market_code| |---|---|---|---|---|---|---|---| |TSLA|TSLA.O|Tesla|20240805|46.672304|6.78778322829854|9.558736320262382|185| |TSLA|TSLA.O|Tesla|20240806|47.085334|6.847852106425076|9.643326907167358|185| |TSLA|TSLA.O|Tesla|20240807|45.001413|6.544777312241192|9.216528945964976|185| |TSLA|TSLA.O|Tesla|20240808|46.662917|6.786418026522937|9.556813806923632|185| |TSLA|TSLA.O|Tesla|20240809|46.935141|6.826008878015427|9.612566693747366|185| |TSLA|TSLA.O|Tesla|20240812|46.346105|6.740342466596333|9.491928981740838|185| |TSLA|TSLA.O|Tesla|20240813|48.772652|7.0932471255897305|9.988898679807578|185| |TSLA|TSLA.O|Tesla|20240814|47.258994|6.873108339273733|9.678893403934223|185| |TSLA|TSLA.O|Tesla|20240815|50.253456|7.308607705691117|10.292175158995306|185| |TSLA|TSLA.O|Tesla|20240816|50.718114|7.376185193583471|10.387339569263405|185| |code|Ticker|Name|Date|Gross Profit Margin|Operating Profit Margin|Net Profit Margin|market_code| |---|---|---|---|---|---|---|---| |TSLA|TSLA.O|Tesla|2024 Q3|18.4363|8.843754775433087|6.6974|185| |TSLA|TSLA.O|Tesla|2024 Q4|17.8626|8.49114546012898|7.3221|185| |TSLA|TSLA.O|Tesla|2025 Q1|16.3072|3.661753297129558|2.1722|185| |TSLA|TSLA.O|Tesla|2025 Q2|16.8081|4.630537161435299|3.8488|185| 3. **Revenue and Cash Flow Challenges**: - Tesla's revenue growth rate is negative at -11.78% year-over-year as of Q2 2025. - Free cash flow is negatively impacted, indicating financial strain. - The company's cash flow situation is further highlighted by a significant drop in operating cash flow, which could be a concern for investors assessing the company's operational efficiency. 4. **Sector and Market Position Considerations**: - Tesla operates in the Automobiles industry within the Consumer Discretionary sector, which is competitive and sensitive to macroeconomic conditions. - The company's market position and competitive landscape are key factors affecting its fundamental performance. Overall, Tesla's financial ratios indicate a company that is facing significant challenges in terms of revenue growth, profitability, and cash flow. While the company has a high valuation relative to its earnings and assets, it lacks strong dividend payments and share buybacks, which are typically signs of a company's financial stability and confidence in its future prospects. The company's fundamental situation is thus complex, with both strengths and weaknesses that investors should carefully consider.