The United States is currently home to 10 companies valued at $1 trillion or more. These are:
Nvidia: 4.4 trillion dollars
Appl: 3.8 trillion dollars
the alphabet: 3.6 trillion dollars
Microsoft: 3 trillion dollars
Amazon: 2.3 trillion dollars
Meta platforms: $1.6 trillion
Tesla(NASDAQ: TSLA ): $1.5 trillion
Broadcom: $1.5 trillion
Berkshire Hathaway: 1 trillion dollars
Walmart: 1 trillion dollars
However, one of them is Considerable More expensive than others when measured by key value metrics. Considering the company’s core business has produced declining sales in each of the past two years, it’s hard to justify its premium valuation.
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This company is Tesla.
Investors have flocked to the stock because the company’s future product platforms, such as the CyberCab autonomous robotics and the Optimus humanoid robot, have huge potential. But here at present, 73% of the company’s total revenue still comes from the passenger electric vehicle (EV) business, where demand is slowing.
Here’s why I predict Tesla will exit the exclusive $1 trillion club before the end of 2026.
Image Source: Tesla.
Tesla delivered 1.79 million EVs to customers in 2024, which was a 1% decrease from last year. But in 2025, deliveries reached 1.63 million cars, which was 9% less than the year. This reduced the company’s 2025 automotive revenue by 10%, which contributed to a massive 47% drop in earnings per share (EPS). Earnings usually drive stock prices, but more on that later.
Tesla’s EV sales may soften further in 2026, as it plans to drop two of its premium vehicles (Model X and Model S) from the lineup. This will allow the company to focus its efforts on cheaper, higher-volume models such as the Model Y and Model 3, which will improve its competitive position against some of China’s lower-cost manufacturers. BYD(OTC: BYDDY).
BYD currently sells the entry-level Dolphin Surf EV in Europe for less than $27,000, for example, while Tesla’s Model 3 starts at more than $40,000. As a result, the Chinese brand quickly gained market share and even outsold Tesla globally in 2025 for the first time.
Tesla CEO Elon Musk doesn’t want to get involved in a race-to-the-bottom price war in the EV business, so he’s shifting the company’s focus to autonomous vehicles and robotics instead. Last year he unveiled the CyberCab robotaxis, which will use Tesla’s Fully Self-Driving (FSD) software to autonomously transport passengers and even small commercial loads.
In theory, Tesla could build a ride-hailing network and deploy millions of cybercabs, where they would generate very high revenue streams around the clock. According to some estimates, this may be a bigger financial opportunity than the passenger EV business. For example, Cathy Wood’s Arc Investment Management predicts that robotics will generate an astonishing $34 trillion in enterprise value by 2030 because they can offer customers a much lower-cost way to travel.
However, Tesla’s FSD technology is only currently approved for unsupervised use in Austin, Texas, and a wider rollout will take considerable time due to strict regulations. The CyberCab is expected to enter mass production this year but may not hit the road before it gets widespread FSD approval.
The size of the market opportunity for humanoid robots is less clear because it is a relatively new industry. However, by 2040, Musk thinks that the number of robots like Optimus will exceed the human population due to their ubiquitous applications in factories, offices and homes.
Tesla will ramp up Optimus production at its Fremont, California plant over the next few years, where it will have additional capacity after the Model X and Model S EVs are phased out.
I mentioned earlier that Tesla’s earnings are down 47% to $1.08 per share in 2025. According to conventional wisdom, Tesla stock should have suffered a sharp decline after taking such a big hit to earnings, but it didn’t. That’s difficult because its stock now trades at a sky-high price-to-earnings ratio (P/E) of 377.
That makes Tesla stock 11 times more expensive Nasdaq-100 index, which means it is worth much more than a basket of its major technical peers. The chart below shows the P/E ratios of all 10 US companies valued at $1 trillion or more and proves that Tesla’s valuation is now in a completely different universe:
TSLA P/E ratio data by YCharts.
Tesla stock would have to drop 77% from here to trade in line with the next most expensive stock, Broadcom, which has a P/E ratio of 87. I’m not suggesting this will happen, but Tesla needs to cut 34% just to get out of the $1 trillion club. If its EV sales continue to decline, or if investors perceive delays in the rollouts of the CyberCab and Optimus products, I think a decline of this magnitude is certainly possible during 2026.
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Anthony DiPizio has no position in any of the listed stocks. The Motley Fool owns and recommends positions in Alphabet, Amazon, Apple, Berkshire Hathaway, MetaPlatforms, Microsoft, Nvidia, Tesla, and Walmart. The Motley Fool recommends BYD Company and Broadcom. Motley Fool has a disclosure policy.
Prediction: This Popular Stock Will Leave the $1 Trillion Club in 2026 Originally Posted by The Motley Fool
