Tesla Stock Pop Analysis: Melius 'Must Own' Rating vs. Bearish Retail Sentiment

On November 24, 2025, Tesla (TSLA) experienced an intraday pop of nearly 7% following two company-specific catalysts: Melius Research labeling TSLA a “must own” due to Full Self-Driving (FSD) progress and CEO Elon Musk’s comments on AI chip development [1]. The stock closed at $417.78, up 3.88% from the previous day with a volume of 96.81M—higher than the 5-day average of ~89.24M [0]. This move outperformed the broader tech sector’s modest 0.149% gain, indicating company-specific news drove the pop rather than sector trends [0].

Valuation metrics highlight investor optimism: TSLA’s market cap stands at $1.37T with a trailing P/E ratio of 224.52x (based on EPS of $1.90) [0]. This extreme P/E ratio reflects expectations of significant future growth from FSD and AI initiatives, though it far exceeds the S&P 500 average (~20x) [0].

Conflicting sentiments emerge: Melius argues Tesla’s vision-only FSD and in-house chips provide a competitive edge [1], while Reddit users express bearish views—citing overhyped FSD claims, repetitive positive narratives, and concerns about algorithmic pumping contributing to the 7% jump [Event Context].

1. Sentiment Divide
   : The pop reveals a split between institutional bullishness (Melius’ rating) and retail skepticism (Reddit’s bearish comments), highlighting market uncertainty about Tesla’s long-term valuation.
2. Valuation Dependence
   : TSLA’s high P/E ratio means its price is heavily tied to successful execution of FSD and AI chip plans; any delays (e.g., the AI5 chip’s push to mid-2027) could trigger corrections.
3. Volume Significance
   : Higher-than-average volume suggests strong institutional interest in the Melius upgrade, though Reddit’s algorithmic trading concerns warrant monitoring.

• Valuation Risk
  : The 224x P/E ratio exposes investors to sharp corrections if FSD/AI progress lags expectations [0].
• Competitiveness Risk
  : Waymo’s lead in Level 4 autonomy (driverless ride-hailing) raises questions about FSD’s long-term viability [0].
• Execution Risk
  : Delays in AI chip production may slow FSD deployment and impact growth projections.

• AI Growth Potential
  : Tesla’s shift to AI/robotics (beyond EVs) offers long-term growth opportunities if executed well [1].
• Institutional Interest
  : Higher-than-average volume indicates institutional confidence in Tesla’s AI-driven future [0].

• Event
  : TSLA popped nearly7% intraday on Nov24,2025 due to Melius’ rating and Musk’s AI comments.
• Price/Volume
  : Closed at $417.78 (up3.88%) with 96.81M volume (above 5-day average) [0].
• Valuation
  : $1.37T market cap, 224.52x P/E ratio [0].
• Sentiments
  : Bullish (Melius) vs bearish (Reddit users citing overhyped claims and valuation risks).
• Key Metrics
  : Tech sector gained 0.149% (TSLA outperformed) [0].