Over the past two years, Tesla's (TSLA 0.27%) stock has been on a spectacular ride. In this clip from "Ask Us Anything" on Motley Fool Live, recorded on April 21, Fool.com contributor Connor Allen discusses what's really behind the electric car company's lofty valuation.
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Connor Allen: Netflix (NFLX -1.85%) is actually a pretty good comparison. You can compare them in that, if Netflix just stays in streaming, their stock is probably going to continue to get hammered. They need to figure something else out. But if you look at Tesla, if they're just a car company they're the most overvalued car company in the history of the world.
What's priced in as the potential of everything else that they're doing? Some people make the case that Tesla could be undervalued based on all of this potential, I am, "I'll believe it when I see it" for a lot of it, which I think was a question that we were all going to talk about at the beginning of the show. Just with all the new technology, all the stuff that Elon talks about. I'm not a believer from the get-go because there's always some exaggeration that comes out of Elon Musk's mouth.