You Can Do Better Than Tesla. Buy Micron Instead.

Tesla (NASDAQ: TSLA) is down by close to 20% over the last year and trades at a price-to-earnings ratio of around 345, making it the worst-performing and worst-valued stock among the highest-market-cap companies.

That combination puts Tesla on the wrong side of a simple risk/reward equation: Investors are paying a steep premium for a stock that hasn't delivered the returns to match.

On top of that, Tesla's business is still primarily based on selling electric vehicles (EVs), and it's been under some strain for a while. Vehicle deliveries have faced pressure, competition has intensified, and repeated price cuts have squeezed its margins. Plus, much of its promised future in AI and robotics is already baked into today's price, which means investors today could be paying an excessive premium.

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