Where Will Tesla Stock Be in 3 Years?

On the surface, shares of Elon Musk’s EV titan Tesla (NASDAQ:TSLA) look quite expensive, especially after gaining more than 41% in the past six months. Undoubtedly, 300 times trailing price-to-earnings (P/E) is a high price to pay for an electric vehicle firm, even if there are some huge catalysts on the horizon that could allow Tesla to comfortably grow into its multiple.

As we enter the year of physical AI, questions linger as to whether it’s time to value Tesla stock more for the potential behind its Optimus robot and the robotaxi opportunity at hand. These are massive markets that could make the priciest-looking member of the Mag Seven actually prove too cheap. 

The robotaxi opportunity is massive, but competition looms

In any case, shares of Tesla are just over 8% from their all-time highs, and there’s a lot on the line as the robotaxi race picks up speed in 2026 and over the next three years. Of course, there’s bound to be intense competition in robotaxis, especially as new entrants and underrated players (think Amazon (NASDAQ:AMZN) and Zoox) look to get a piece of the opportunity to be had. With Nvidia (NASDAQ:NVDA) also getting in on the action, with plans to launch a service in 2027, Tesla will need to stay on its toes if it’s to hang onto its premium multiple.

As more Mag Seven titans join the robotaxi race, perhaps it’s time to brace for the potential announcements of more new entrants that step up once the robotaxi market matures. Undoubtedly, Apple (NASDAQ:AAPL) is a name that immediately comes to mind as a firm that might give the robotaxi scene a second look.

Of course, the Cupertino-based giant pulled the plug on its Apple Car plans nearly two years ago. But if the robotaxi business proves lucrative and there are partners to team up with to reduce expenses, I wouldn’t be surprised if Apple Car rumors were to resurface at some point down the road.

Even if Apple doesn’t revive its autonomous driving plans, the robotaxi market looks set to get a bit more crowded in the coming years. Whether that takes away from Tesla’s robotaxi catalyst, though, remains to be seen. Some of the bulls, including Ark Invest’s Cathie Wood, are big believers that Elon Musk and company can offer a product that winds up dominating the road of the future.

Are investors underestimating the Cybercab’s potential

Back in 2024, Wood predicted that nearly 90% of Tesla’s enterprise value would arise from robotaxis. Whether the robotaxi opportunity is enough to power shares to $2,600 per share, though, is another question entirely. The total addressable market certainly has the potential to be sizeable, but whether Tesla can keep new entrants into the scene at bay remains the trillion-dollar question.

Either way, if Musk can execute and the Cybercab can scale up faster than the competition in the coming years, perhaps acting as a fast mover could help Tesla secure a spot atop a market that might result in a winner-takes-most kind of scenario. Perhaps that’s why Apple shelved its Apple Car plans a while back. Any way you look at it, Tesla has the momentum, and if it’s one of the first to roll out into new markets, its service might end up being the stickiest.

While Cybercab and robotaxis are the big opportunities, I wouldn’t discount the potential of Optimus, which also might ramp up production significantly going into 2029. While “millions” of robots might be a bit overly ambitious, I do think there’s a good chance investors will view Tesla as more of a consumer robotics company in three years, if they aren’t already.

All considered, I think there’s a good chance Tesla stock becomes even pricier in three years, especially if Cybercab and Optimus hit all the right milestones and EVs end up becoming a far smaller slice of total revenues.