Tesla vs. Salesforce: With Return Forecast Of 48%, Tesla Is A Better Bet

Last Updated: 11/1/2024

We Forecast Higher Stock Return For Tesla vs. Salesforce

Tesla is trading at a more expensive P/S valuation vs. Salesforce and it makes sense to pay more for Tesla for a higher return

TSLA and CRM have similar operating income

3-Year Return Depends On [1] Revenue Growth [2] P/S

[1] How Much Can Revenue Grow In Next 3 Years

We forecast annual revenue growth of 10.3% for TSLA and 11.1% for CRM

[2] Which P/S Scenarios Make Sense

We forecast P/S of 9.4 for TSLA and 7.7 for CRM based on below plausible scenarios

Are Current P/S Ratios Justified

A higher P/S is justified by higher margin, higher revenue growth, better margin expansion, and lower risk

P/S Ratio

Revenue Growth & Operating Margin

Financial & Market Risk

Note On P/S Justification

Past Market Return Comparison vs. Benchmarks

Since 2019, Tesla and Salesforce returned 1083% and 115% respectively vs. 132% for S&P 500 and 520% for Trefis Reinforced Value Portfolio

 

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