What would need to happen for TSLA to *not* be overvalued today?

Currently TSLA is trading close to $265/share, or about an $880B market cap.

It's a reasonable argument that if an asset can beat the S&P 500 CAGR, then it's a good investment. Given that the S&P typically provides a 5% CAGR, let's see what would be needed for Tesla to achieve a 10% CAGR by, let's say.. end of 2030.

$880B * 1.10^7 = $1.71T market cap, or about $512/share

So how does Tesla make it to a $1.7T market cap in 2030? I'm going to assume a 30 P/E, which everyone will bitch and complain about beause they hate Tesla, but I think there's reasonable arguments for and against 30. The “for” argument being that I believe they'll still be growing EV sales and energy storage products. If a 30 P/E, then Tesla needs:

$1710B / 30 = $57B in gaap earnings

So how much gaap earnings does Tesla make per EV sold? I'll link to a graph of the “TTM avg gaap earnings per EV sold” in the comments

Tesla's current earnings profitability is about $5,600 per EV sold, and it continues to go up over the long term, even if rates have caused a recent drop (earnings per EV maxed out at $10.3k in q1 2022). Let's just assume a long term profitability of $5,700 per EV (super conservative imo). Tesla will need to sell about

$57B earnings / $5,700 earnings per EV = 10M EVs annually

Conclusion: If Tesla sells 10M EVs in 2030, then it is not overvalued today, in fact.. it beats the S&P. This isn't even including profits from the energy storage sector of the business, or the wildcards of robotaxis and bots.