Tesla stock faces mounting skepticism from veteran investor George Noble, who warns that the electric vehicle maker represents what he calls potentially the biggest bubble in stock market history. The former Fidelity International fund director and hedge fund founder told Business Insider that Tesla’s valuation is fundamentally disconnected from its business performance, challenging the popular narrative that the company is more than just an automaker.
Noble has taken a bearish position against Tesla, arguing that shares should trade between $60 and $140 based on current fundamentals. At the lower end of that range, the estimate would represent an 87% decline from Friday’s trading price, a dramatic departure from the company’s $1.4 trillion market valuation.
Tesla Stock Valuation Concerns Mount Amid Declining Sales
At the heart of Noble’s skepticism lies Tesla’s declining sales performance and intensifying competition in the electric vehicle market. According to the investor, the company has experienced a second consecutive year of falling sales in 2025, with projections suggesting a third year of decline in 2026. This trend stands in stark contrast to the premium valuation that Tesla stock commands in the market.
The hedge fund founder emphasized that Tesla remains primarily an automotive company despite CEO Elon Musk’s broader ambitions. Vehicle sales account for 87% of the company’s revenue, yet this core business continues to face significant challenges. Additionally, Noble estimates that the automotive business alone justifies a valuation of only $20 per share based on comparative industry valuations.
Narrative Versus Fundamentals
Noble believes that Tesla’s stock price is driven more by narrative hype than actual business success. He pointed to Musk’s history of promoting various ventures, from solar power to The Boring Company, and decade-long promises about robotaxis that have yet to materialize. “The product is the stock. It’s not the cars,” Noble stated, according to Business Insider.
The investor finds particular concern in the widespread Wall Street belief that Tesla transcends its identity as a car manufacturer. However, despite Musk’s ambitious claims about humanoid robots and autonomous vehicles, the company’s revenue remains heavily dependent on traditional vehicle sales. This disconnect between perception and reality forms the basis of Noble’s bearish investment thesis.
Growing Chorus of Tesla Stock Skeptics
Noble is not alone in questioning Tesla’s market valuation. Porter Collins of Seawolf Capital, one of the investors featured in “The Big Short,” recently identified Tesla as among the market’s most overvalued names. Meanwhile, longtime Tesla investor Ross Gerber spent 2025 gradually reducing his firm’s stake in the company.
Gerber, who was an early backer of Musk’s venture, told Business Insider in December that 2026 would be a year of reckoning for Tesla stock. The growing skepticism among both short sellers and former supporters suggests a potential shift in investor sentiment. In contrast to the bullish narrative that has dominated discussions about Tesla for years, these voices represent a more cautious perspective grounded in traditional valuation metrics.
Market Competition and Business Challenges
The electric vehicle market has become increasingly competitive, with established automakers and new entrants challenging Tesla’s dominance. Noble highlighted this intensifying competition as a key factor in his bearish outlook, noting that the company’s sales trajectory reflects these market pressures. The investor argues that Tesla’s premium stock valuation fails to account for these competitive headwinds and the company’s weakening market position.
Furthermore, the gap between Tesla’s market capitalization and its operational performance continues to widen. According to Noble’s analysis in a recent blog post, the automotive-related business faces ongoing challenges that warrant a significantly lower valuation than current market prices suggest.
The market will likely continue to debate Tesla’s true valuation as the company releases its 2026 sales figures and provides updates on its autonomous driving and robotics initiatives. However, the timeline for when these concerns might materially impact the stock price remains uncertain.
