Is Tesla really more valuable than Toyota?

Market cap alone is a misleading measure of company value because it ignores debt. When comparing Tesla and Toyota, Tesla's $558bn market cap dwarfs Toyota's $329bn — but Toyota carries $200bn in debt versus Tesla's $9bn. Using enterprise value (market cap + borrowings - cash), Tesla ($553bn) and Toyota ($466bn) are much closer. The post explains why companies choose debt vs. equity financing, using Teledyne's Henry Singleton as a case study: Teledyne issued shares when overvalued during the 1960s conglomerate boom, then bought them back aggressively when undervalued after the bubble burst, generating exceptional returns.