Under value

Screening Filters

1. Market Cap ≥ $100B

   • Purpose: Focus on very large, established companies.
   • Rationale: TSLA is a mega-cap stock. To judge whether it’s undervalued, you typically compare it with companies of similar scale and market maturity. Limiting the universe to $100B+ avoids skewing comparisons with much smaller, riskier firms whose growth and valuation dynamics are very different.

2. Theme: Electrical Vehicles

   • Purpose: Restrict results to companies directly involved in the EV space.
   • Rationale: Valuation is most meaningful when you compare TSLA to close peers facing similar industry trends (EV adoption, battery tech, charging networks, regulation, etc.). Using the “Electrical Vehicles” theme helps build a peer set whose revenue drivers and growth expectations are broadly comparable to Tesla’s core business.

3. Index Component: S&P 500 (GSPC) or NASDAQ 100 (NDX)

   • Purpose: Include only large, highly followed, and relatively liquid companies.
   • Rationale: Major index constituents are subject to strong analyst coverage and institutional scrutiny, so their valuations often serve as more robust benchmarks. Comparing TSLA to other EV-related, large-cap index members helps gauge whether its multiples are unusually high or low relative to similarly visible, widely-owned stocks.

4. Revenue 5-Year CAGR ≥ 20%

   • Purpose: Ensure peer companies have strong historical top-line growth.
   • Rationale: Tesla is a high-growth company; comparing it to slow-growing automakers would distort any valuation view (high multiples are more “normal” for high-growth firms). By requiring ≥20% revenue CAGR, the screen finds companies whose sales growth profile is closer to Tesla’s, making valuation ratios like P/S and forward P/E more comparable.

5. EPS 5-Year CAGR ≥ 20%

   • Purpose: Focus on companies with strong earnings growth, not just revenue growth.
   • Rationale: For an “undervalued” assessment, investors care about profits and cash flows, not just sales. By filtering for firms with ≥20% EPS CAGR, you get a set of stocks that, like Tesla, have been rapidly growing earnings (or at least are expected to). This helps when comparing TSLA’s P/E or PEG ratio against businesses with similarly strong earnings trajectories.

Why Results Match the User’s Question

• The screen doesn’t directly answer “Is TSLA undervalued?”; instead, it builds a relevant peer group—large, EV-focused, high-growth, index-listed companies—against which TSLA’s valuation can be compared.
• By controlling for company size, industry, and growth profile, these filters allow a more apples-to-apples comparison of valuation metrics, which is exactly what you need to form a reasoned view on whether TSLA looks cheap or expensive relative to similar stocks.