Tesla (TSLA) has faced significant challenges in 2024, with its stock plummeting by over a third since the beginning of the year. Despite this decline, Tesla's stock price hasn't notably decreased based on a key metric. Generally, when a stock experiences a sharp decline, investors and analysts often view it as an opportunity, citing potentially cheaper valuations. With Tesla's stock down 30.5% year-to-date through March 25, it stands as the poorest performer on the S&P 500, having dropped 58.3% from its late 2021 all-time high.

However, Tesla's stock decline aligns closely with diminishing earnings estimates amid lower-than-anticipated deliveries despite ongoing price reductions. Analysts have revised down their 2024 earnings per share estimates to $2.95, a significant decrease from $7.07 at the end of 2022. Despite the decline in Tesla's forward price-earnings ratio from earlier points, it remains relatively high compared to previous years, signaling that the stock may not be significantly undervalued. Tesla's valuation stands notably above that of other profitable automakers, such as Toyota Motor and General Motors.