Shares of Tesla Inc. (NASDAQ:TSLA) have dropped nearly 18% year-to-date. Gary Black expressed caution over the company’s stock due to a “stretched valuation,” after the automaker reported third-quarter vehicle deliveries that exceeded consensus estimates.
Delivery Numbers Exceed Expectations
Tesla reported third-quarter deliveries of 486,500 vehicles on Friday, surpassing the consensus estimate of 462,000. This figure represents a 2% year-over-year decline compared to Tesla’s record third quarter in 2025, which coincided with the expiration of a $7,500 EV tax credit. This follows a second quarter in which Tesla delivered 480,000 vehicles against Wall Street expectations of 406,000.
Despite these “two consecutive very strong delivery numbers,” Black warned of company-specific and broader market headwinds. “I remain cautious on $TSLA given declining forward earnings ests, the continuing commoditization of unsupervised autonomy, and a stretched valuation,” Black posted on X. He noted this valuation concern comes as S&P 2026 earnings estimates imply an earnings yield well below 10-year Treasury yields.
The stock’s 17.60% year-to-date drop compares to a 22.33% gain for the Nasdaq 100 index over the same period.
The Unsupervised Autonomy Scale-Up
Investors are increasingly focused on Tesla’s efforts to scale its unsupervised autonomy technology against competitors. Black stated that while Tesla’s generalized technology is superior, its rollout has fallen short of management’s prior guidance to have unsupervised autonomy with no safety drivers in eight to ten metro areas by the end of 2025.
Currently, Tesla’s unsupervised autonomy is approved for use in six U.S. metropolitan areas across Texas and Florida, with the San Francisco Bay Area pending. As of Oct. 2, Tesla had approximately 589 vehicles registered as fully autonomous in Texas, consisting of 420 Model Ys and 169 Cybercabs.
In contrast, competitor Waymo operates more than 4,000 driverless vehicles nationwide. Waymo is authorized for public, fully driverless rides in 15 U.S. metros, including Los Angeles, Phoenix, Dallas, and Atlanta.
How Has TSLA Performed in 2026?
Price Action: At the last check, the TSLA stock was 0.51% lower in pre-market trading on Monday. It was down 15.00% over the last year, 17.60% year-to-date, and higher by 3.80% over the last month. The stock closed up 4.65% at $370.59 on Friday.
Benzinga’s Edge Stock Rankings indicate that TSLA maintains a weak price trend in the short, medium, and long terms, with a poor value score.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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