Stanley Black & Decker, Inc. (SWK) vs Tesla, Inc. (TSLA): Which Is the Better Buy in 2026?
As of 2026-08-03, SWK is fairly valued at $95, with a DCF intrinsic value of $105 and a margin of safety of 10%. TSLA is overvalued at $311, with an intrinsic value of $143 and a margin of safety of -118%. Of the two, SWK has the wider margin of safety.
Rewards
- ★FCF yield of 9.9% is historically attractive — the business generates significant cash relative to its price.
- ★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
- ⚠Despite buyback spending, shares outstanding increased in 3 out of 4 years — stock-based compensation is offsetting repurchases.
- ⚠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 $95?
The market implies +13.2% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +2.1%, reflecting heavy growth investment.
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 →Narrow moat with revenue predictability as the key competitive advantage. Improving roic consistency would strengthen the moat.
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 optimistic — be cautious and ensure you have a margin of safety"
"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: SWK vs TSLA
Is Stanley Black & Decker, Inc. or Tesla, Inc. more undervalued in 2026?▼
Based on our discounted cash flow model, SWK trades at a 10.1% margin of safety (intrinsic value $105 vs. price $95), compared to TSLA's -117.9% margin of safety (intrinsic $143 vs. $311).
Which stock has a wider economic moat, Stanley Black & Decker, Inc. or Tesla, Inc.?▼
SWK scores 48/100 (Narrow moat), while TSLA scores 31/100 (None moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is Stanley Black & Decker, Inc. in financial distress?▼
SWK's Altman Z-Score of 2.1 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 company has better free cash flow, Stanley Black & Decker, Inc. or Tesla, Inc.?▼
Stanley Black & Decker, Inc. (SWK) generates a 9.9% free cash flow yield, compared to Tesla, Inc.'s 0.4%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, Stanley Black & Decker, Inc. or Tesla, Inc.?▼
SWK earns 7.2% 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.