Bill Miller’s Bold Call: Why Amazon is a Buy and Tesla a Sell in 2025

Legendary investor Bill Miller, famed for outperforming the S&P 500 for 15 straight years, has made a stark recommendation: buy Amazon (AMZN) and sell Tesla (TSLA). His rationale, rooted in valuation, competitive positioning, and long-term fundamentals, offers a masterclass in contrarian investing. Here’s why he’s doubling down on Amazon while dumping Tesla—and why investors should take note.

Amazon: A Multi-Front Dominance

Miller’s bullish stance on Amazon hinges on its strategic resilience and undisputed leadership in key growth areas.

1. AWS: The Engine of Cash Flow

Amazon Web Services (AWS) remains the crown jewel. Miller points to AWS’s $85 billion in annual revenue (as of 2024) and its 20% year-over-year growth, even as macroeconomic headwinds loom. The cloud giant’s dominance in AI infrastructure—backed by $100 billion in annual tech investments—gives it a moat against rivals like Microsoft Azure and Google Cloud.

2. E-commerce and Tariffs: A Structural Tailwind

While tariffs on Chinese imports have spooked investors, Miller argues Amazon’s exposure is overstated. Only 12% of Amazon’s U.S. sales come from Chinese imports, and its logistics network allows rerouting to Vietnam and Mexico. More importantly, tariffs could weaken smaller competitors like Temu and Wish, letting Amazon capture market share.

3. Project Kuiper: The Next Frontier

Amazon’s $10 billion satellite internet project, Project Kuiper, is a sleeper threat to SpaceX’s Starlink. With plans to launch 3,236 satellites by 2027, it could tap into the $800 billion global broadband market—a play few investors are pricing in.

4. Valuation: A Bargain at These Levels

Amazon’s stock has fallen 17.9% year-to-date in 2025, pushing its forward P/E to 22x—a discount to its 10-year average of 28x. Miller sees this as a buying opportunity, contrasting it with Tesla’s sky-high valuation.

Tesla: Overvalued and Overexposed

Miller’s bearish call on Tesla reflects execution risks, overvaluation, and brutal competition.

1. Deliveries Stumble, Competitors Surge

Tesla’s Q1 2025 deliveries dropped to 337,000, the lowest in two years, while BYD’s global sales hit 1.1 million—a stark illustration of the market share shift. BYD’s $9,000 Atto 3 EV with self-driving features undercuts Tesla’s $8,000 premium for Full Self-Driving (FSD), making it a better value.

2. Valuation: Too Much, Too Soon

Tesla trades at a 144x forward P/E, far above its five-year average of 115x. Miller argues this assumes perfection in unproven ventures like its Robotaxi pilot (due June 2025) and AI supremacy. Even if successful, the stock’s price already “bakes in” flawless execution—a high bar for any company.

3. Margin Pressure and Musk’s Distracted Leadership

Tesla’s automotive revenue fell 9.2% year-over-year in Q1 2025, with margins collapsing to 2.1% from 11.4% in 2023. Meanwhile, Elon Musk’s White House role has raised concerns about his focus on Tesla. “He’s a genius, but the stock price assumes no missteps,” Miller noted.

4. Analysts Agree: Sell the Overhang

Of 41 analysts covering Tesla, 10 recommend a ‘Strong Sell’, with a $283 average price target—$50 below current levels. The risks of execution failures and pricing wars are too great to justify the premium.

The Bottom Line: A Masterclass in Contrarian Investing

Miller’s picks reflect a deep understanding of valuation discipline and long-term structural trends. Amazon’s cash flow from AWS, supply chain agility, and future-proof bets like Kuiper make it a rare growth stock at a reasonable price. Meanwhile, Tesla’s reliance on Musk’s vision, high valuation multiples, and fading competitive edge mark it as a value trap.

The data backs this up:
- Amazon’s $250 billion in cash and equivalents give it a war chest to outspend rivals.
- Tesla’s $80 billion in debt and narrowing margins highlight financial strain.
- Miller’s track record? His fund returned 15% annually over 15 years—a testament to his ability to spot mispriced opportunities.

Investors ignoring Miller’s call may find themselves on the wrong side of a historic shift in tech and auto markets. Buy Amazon’s future. Sell Tesla’s past.