This Popular Stock Will Tumble Out of the $1 Trillion Club in 2026

In theory, Tesla could build a ride-hailing network and deploy millions of Cybercabs, where they would produce a very high-margin revenue stream around the clock. By some estimates, this might be an even bigger financial opportunity than the passenger EV business. Cathie Wood’s Ark Investment Management, for instance, predicts robotaxis will generate a staggering $34 trillion in enterprise value by 2030 because they could offer consumers a very low-cost way to travel.

However, Tesla’s FSD technology is only approved for unsupervised use in Austin, Texas right now, and a broader rollout will take a significant amount of time due to strict regulations. The Cybercab is expected to enter mass production this year but might be grounded before it even hits the road without wider FSD approval.

The size of the market opportunity for humanoid robots is less clear because it’s a brand new industry. However, by 2040, Musk thinks the number of robots like Optimus will exceed the human population because of their versatile applications in factories, offices, and households.

Tesla will ramp up production of Optimus over the next couple of years in its Fremont, California factory, where it will have spare capacity after phasing out the Model X and Model S EVs.

I mentioned earlier that Tesla’s earnings plummeted by 47% to $1.08 per share in 2025. According to conventional wisdom, Tesla stock should have suffered a sharp decline after its earnings took such a massive hit, but it hasn’t happened. This is problematic because its stock now trades at a sky-high price-to-earnings ratio (P/E) of 377.

That makes Tesla stock more than 11 times as expensive as the Nasdaq-100 index, implying it’s heavily overvalued, relative to a basket of its big-tech peers. The below chart displays the P/E ratios of all 10 American companies with valuations of $1 trillion or more and proves that Tesla’s valuation is in a completely different universe right now:

Tesla stock would have to plunge by 77% from here just to trade in line with the next-most-expensive stock, Broadcom, which has a P/E ratio of 87. I’m not suggesting that will happen, but Tesla only needs to decline by 34% to drop out of the $1 trillion club. If its EV sales continue to shrink, or if investors sense delays to the Cybercab and Optimus product rollouts, I think a decline of that magnitude is certainly possible during 2026.

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Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, Nvidia, Tesla, and Walmart. The Motley Fool recommends BYD Company and Broadcom. The Motley Fool has a disclosure policy.

Prediction: This Popular Stock Will Tumble Out of the $1 Trillion Club in 2026 was originally published by The Motley Fool