Musk and Zuckerberg’s Real Cage Fight Is in the Stock Market. And It’s a Lot Closer Than You Think

Have you heard? Tesla CEO Elon Musk and Meta Platforms CEO Mark Zuckerberg are talking about battling it out inside a cage. Really. The discussions between the parties over a possible physical fight have been progressing, according to the latest media report.

Shares of Elon Musk’s Tesla are up 127% this year. Mark Zuckerberg’s Meta is up 138%.

It started last month when Musk replied to a tweet talking about Zuckerberg’s Meta Platforms (ticker: META) potentially coming out with a rival to Twitter by posting, “I’m up for a cage match if he is lol.” To which Zuckerberg responded with a “Send Me Location” post on Instagram. Now, the New York Times reports that both sides are in active negotiations over a fight that is slated to be an exhibition match produced by Ultimate Fighting Championship President Dana White.

For investors, a mixed martial arts event between the billionaire entrepreneurs would be a distraction—the real fight remains in the stock market.

Given that Musk and Zuckerberg lead two of the most important companies in the world, Barron’s thought investors could benefit from a look at how the companies they founded match up in a face-off, based on real fundamentals—a tale of the tape in boxing parlance.

After pulling together the data, there’s a surprising similarity between the electric vehicle maker and social media firm’s metrics despite their different end markets. Many of the numbers are neck and neck.

Take stock performance. On Monday, Tesla (TSLA) shares surged by 7% to $279.82 a day after the company reported better-than-expected vehicle deliveries for the second quarter. The rally lifted Tesla’s year-to-date return to 127%, compared with a 138% return for Meta over the same period. Their market values, too, are in the same ballpark.

Valuation multiples, however, still differ significantly. Tesla has a much higher price-to-earnings ratio, which is somewhat justified by its faster growth rate. Tesla’s profit margin, it’s worth noting, is likely to decline this year as the company pursues a growth strategy through lower car prices.

Ultimately, no one knows who would win a “cage match” between Musk and Zuckerberg. Investors should pay more attention to tracking the battle between their companies.