Is What Trillionaire Elon Musk Said Enough of a Reason to Buy Tesla Stock?
Key Points
Investors might see full self-driving and Robotaxi generate substantial revenues in 2027.
Tesla is still a story stock, as the narrative surrounding the business holds more weight than the fundamentals.
Musk has a spotty track record of predicting when certain technological milestones will happen.
- These 10 stocks could mint the next wave of millionaires ›
Tesla (NASDAQ: TSLA) shares have soared 2,810% in the past decade (as of June 23). The success of the electric vehicle (EV) maker (which is one of the world's most valuable companies), coupled with the recent initial public offering of Space Exploration Technologies, has made CEO Elon Musk the world's first trillionaire.
On Tesla's first-quarter 2026 earnings call in April, Musk made a bold prediction that should spark the market's curiosity. Are the tech entrepreneur's words enough of a reason to buy the EV stock?
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Image source: The Motley Fool.
2027 might be the year Tesla's financials get a meaningful boost
Investors listen closely to what management teams discuss on company earnings calls. Musk seems to always give his shareholders a sense of optimism. This is particularly true of Tesla's full self-driving (FSD) and Robotaxi plans.
"I think probably unsupervised FSD or Robotaxi revenue will not be super material this year, but I do think it'll be material probably in a significant way next year," he mentioned on the most recent earnings call.
It's anyone's guess what a material effect translates to in a quantitative sense. As of March 31, Tesla counted 1.28 million FSD (supervised) subscriptions. Assuming all of these subscribers pay $99 per month for the service -- which isn't the case, as some paid a one-time fee upfront -- it brings in annual revenue of $1.5 billion, which is tiny.
The company's Robotaxi fleet was completing unsupervised rides in Austin, Dallas, and Houston in April. Its revenue is probably negligible at this point.
"We certainly hope to have unsupervised FSD or Robotaxi operating in, I don't know, a dozen or so states by the end of this year," Musk said on the call. This means progress must accelerate in 2027 to have a notable financial effect.
Even though history paints a clear picture, the market has high hopes
Tesla is a story stock. The market puts far more weight on the narrative surrounding the company -- that it's an AI-fueled self-driving and robotics lab -- than on its current state as an EV manufacturer with lower growth and pressured margins.
This shows up in the extreme valuation, with shares trading at a price-to-earnings ratio of 349. The investment community evidently believes that Tesla's FSD and Robotaxi capabilities will lead to robust financial success.
Anyone who follows this business knows that nothing is certain. This is especially true when trying to make timely predictions about the adoption curve of novel technologies. So, despite Musk's claim of a material financial effect in 2027, investors should practice caution when it comes to this Magnificent Seven stock.
According to a study by The New York Times, Elon Musk has achieved what he said he would only 19% of the time. It's hard to believe that this low hit rate will improve in the future.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
- Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $516,781!*
- Apple: if you invested $1,000 when we doubled down in 2008, you’d have $55,859!*
- Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $387,428!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
See the 3 stocks »
*Stock Advisor returns as of June 25, 2026.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.
Recommended Articles
