# Prof. Aswath Damodaran explains why he believes Tesla is overvalued at its current market price

1 Faculty News September 6, 2013 ![CNBC logo](/sites/default/files/styles/246w/public/assets/images/con_034412.gif?itok=MRidxYS3)>

Excerpt from [CNBC](http://video.cnbc.com/gallery/?video=3000197209&__source=yahoo%7Cheadline%7Cquote%7Cvideo%7C&par=yahoo) -- "On Tesla itself, I think there's been a lot of good news about the company, but it's still a small company. 1.3 billion in revenues. It's losing money. And even with an optimistic view of the future, if you think of it as an automobile company, I find it difficult to get to the $20 billion that you get as a market cap for the company right now. If you allow the revenues to go from where they are now to Audi levels, $65 billion, and the margins to improve to Porsche level margins, they are among the highest in the auto sector, you still end up with a value of about $8 billion, $9 billion, $10 billion for the company. If you want to stretch to $20 billion, you've got to give me a really good narrative as to what's going to be different about the future for this company."

[Watch the video](http://video.cnbc.com/gallery/?video=3000197209&__source=yahoo%7Cheadline%7Cquote%7Cvideo%7C&par=yahoo)