Tesla Stock in 2027: Why I Think TSLA Still Has Room to Run

Tesla's stock price appears to be quite high according to its financial metrics. With a price-to-earnings ratio of 330 and a forward earnings ratio of 180, it is considered expensive by traditional standards. The stock's PEG ratio is also notably high at 6.9, which is among the largest for large-cap companies. This justifies the skepticism surrounding the stock's potential for further appreciation.

Despite this seemingly steep valuation, Tesla remains a profitable company. In the second quarter of 2026, the company generated approximately $28.24 billion in revenue, with $398 million in operating income. However, the operating margin was relatively low at 1.4%, reflecting the company's aggressive investments in new projects and the increase in associated costs.

Automotive revenue alone amounted to around $20.52 billion, representing a year-over-year growth of approximately 23%. The energy business contributed over $3.14 billion, demonstrating double-digit growth rates even as margins in this sector were reset downwards.

Despite the high stock price, Tesla's strategic initiatives provide reason to believe that the stock still has significant upside potential. Management recently unveiled a detailed roadmap for two major projects: Full Self-Driving (FSD) and robotaxis. The goal is to achieve unsupervised FSD capabilities on customer vehicles by the fourth quarter of 2026 and commence robotaxi operations in approximately a dozen U.S. states by the end of the year.

Simultaneously, Tesla has started deploying first-generation Optimus humanoid robot lines at its facilities in Fremont. The initial production capacity for these robots is projected to be up to 1 million units per year by late 2026, with a future expansion potential of 10 million units annually in Texas.