Prediction: Here's What $1,000 Invested in Tesla Stock Will Be Worth in 3 Years
Last week, the world was treated to the remarkable visual of a car driving up a vertical ramp, pausing while upside down, and then flipping in midair and launching itself gently back to the ground using compressed-air thrusters.
The vehicle that did that was the ultra-limited-edition “Rocket” tier of electric vehicle (EV) giant Tesla‘s (NASDAQ: TSLA) new Roadster, which is currently scheduled to go into production in 2028.
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To be fair, Elon Musk‘s companies have long track records of overpromising and under-delivering, particularly on timelines, and experienced Tesla watchers shouldn’t expect this time to be any different. That said, the event highlights why Tesla continues to capture the market’s attention, even as its core business segments slow. Let’s dig into the pros and cons of the company as an investment, and map out what a $1,000 position opened today might be worth in three years.
The Musk premium
While the Roadster reveal was exciting, the car won’t do much to move the needle on Tesla’s revenue and earnings. Electric supercars are already a niche market — add powerful suction fans that improve handling and offer one the ability to briefly drive upside down, and compressed-air thrusters that can power a few seconds of flight for a one-seater vehicle, and the addressable market becomes even smaller.
Mass production is likely out of the question for that highest trim Roadster model, which Tesla says it will sell by invitation only. Even the base “Performance” model is expected to sell for $200,000 or more. So in the best-case scenario, investors should expect a limited number of annual sales volumes (perhaps in the hundreds), similar to other hypercar brands like Bugatti, Koenigsegg, and Rimac Nevera. That said, this project’s real value is not in moving huge numbers of units; it’s about bolstering the reputation for innovation that is key to Tesla’s valuation.
Trading today at a price-to-earnings (P/E) multiple of 352 compared to the S&P 500‘s average ratio of 24, Tesla stock is extremely expensive. And the premium isn’t coming from optimism about its core EV business, which is facing surging competition in China and Europe as well as a less favorable regulatory environment in the U.S. Instead, Tesla’s value relies on optimism about products and services it aims to roll out widely in the future and the ability of its CEO to pioneer innovations that other companies lack the vision or capabilities to pursue.
Will the Musk premium translate to real value?
Tesla will eventually need to justify the huge expectations built into its stock price. Its second-quarter results show it still has a long way to go. The good news was that total revenue jumped 26% year over year to $28.2 billion, which shows that the company is recovering from the recent demand and brand destruction (particularly in Europe) caused by Musk’s political involvement.
However, the top line tells only half the story. Tesla’s operating income cratered by 57% to just $398 million due to deteriorating margins as it implemented aggressive price cuts to attract buyers and poured money into research and development to support its pivot toward artificial intelligence and robotics. These efforts also involve substantial capital spending, which caused Tesla to burn through $1.09 billion in the quarter.
Investors shouldn’t necessarily see this as a bad thing, because succeeding in these new business verticals might be the only way Tesla can escape the EV industry’s grinding race to the bottom as Chinese automakers continue to flood the global market with lower-priced models.
Right now, Tesla’s robotaxi business looks like the company’s most promising source of revenue diversification. In July 2025, analysts at S&P Global estimated that the company’s self-driving ride-share business could produce 45% of its automotive segment revenues by 2030. That prospect should be enough to keep the Musk premium alive for a few more years.
What will Tesla stock be worth in three years?
Right now, Tesla’s stock is in a state of limbo. The company’s valuation is simply too high for the stock to deliver much meaningful growth regardless of how well the business performs, but optimism about its innovative leadership and future projects is preventing a meaningful crash. This situation doesn’t look likely to change any time soon. Investors shouldn’t expect a $1,000 investment made today to do much over the next three years unless more information becomes available.
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Will Ebiefung has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends S&P Global and Tesla. The Motley Fool has a disclosure policy.
Prediction: Here’s What $1,000 Invested in Tesla Stock Will Be Worth in 3 Years was originally published by The Motley Fool