Micron Technology, Inc. (MU) vs Tesla, Inc. (TSLA): Which Is the Better Buy in 2026?
As of 2026-08-03, MU is undervalued at $823, with a DCF intrinsic value of $373478115132 and a margin of safety of 100%. TSLA is overvalued at $311, with an intrinsic value of $143 and a margin of safety of -118%. Of the two, MU has the wider margin of safety.
Rewards
- ★Gross margin of 72.6% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Trailing P/E of 18.6x is 66% below the historical average of 54.6x — potentially undervalued relative to its own history.
- ★PEG ratio of 0.12 suggests the stock is undervalued relative to its growth rate — paying less than 1x for each unit of earnings growth.
- ★Altman Z-Score of 19.94 indicates very low bankruptcy risk — the company is firmly in the safe zone.
- ★Net debt/EBITDA of -2.6x means the company holds more cash than debt — a net cash position.
Risks
- ⚠Micron Technology, Inc. scores only 20/100 on the Economic Moat Score, suggesting limited durable competitive advantages.
- ⚠10 insider sales totaling $169.4M with no purchases in the past 3 months — insiders are reducing their exposure.
- ⚠Free cash flow has declined at a 18.8% CAGR over the past 4 years — a concerning trend.
- ⚠ROIC has declined by 21.5 percentage points over the past 4 years, which may signal competitive erosion.
- ⚠Gross margin of 18.9% is low, suggesting a competitive or commodity-like market with limited pricing power.
- ⚠Share count has increased by 19% over the past 4 years, diluting existing shareholders.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →What growth rate is the market pricing in at $823?
The market implies -30.0% Owner Earnings growth, below historical trends — potential opportunity.
Standard FCF implies a more demanding -30.0%, reflecting heavy growth investment expected to generate future returns.
What growth rate is the market pricing in at $311?
The market implies +47.0% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +43.3%, reflecting heavy growth investment.
Economic Moat Score
Learn more →No durable competitive advantage detected. The business shows limited evidence of pricing power, consistent returns, or capital efficiency.
No durable moat detected, though revenue predictability shows some competitive positioning. The business lacks consistent evidence of sustainable advantages.
Forensic Accounting
Learn more →M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is pessimistic — investigate whether fears are temporary or structural"
"Market is pessimistic — investigate whether fears are temporary or structural"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: MU vs TSLA
Is Micron Technology, Inc. or Tesla, Inc. more undervalued in 2026?▼
Based on our discounted cash flow model, MU trades at a 100.0% margin of safety (intrinsic value $373478115132 vs. price $823), compared to TSLA's -117.9% margin of safety (intrinsic $143 vs. $311).
Which stock has a wider economic moat, Micron Technology, Inc. or Tesla, Inc.?▼
TSLA scores 31/100 (None moat), while MU scores 20/100 (None moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is Micron Technology, Inc. in financial distress?▼
MU's Altman Z-Score of 1.9 places it in the Grey zone, signaling elevated bankruptcy risk. TSLA scores 19.9 (Safe zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which stock has higher return on invested capital, Micron Technology, Inc. or Tesla, Inc.?▼
MU earns 53.5% ROIC versus TSLA's 1.1%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.