Elon Musk is an entrepreneur in a bubble.

Forced to choose between issuing a bit more of Tesla’s turbocharged stock or tapping the overheated junk-bond market to finance the Model 3 ramp-up, Mr. Musk, the company’s founder, opted for the latter. It raises execution risk for the $60 billion electric-car maker, but not by enough to persuade the chief executive to loosen his grip on the wheel.

Tesla has just over $3 billion in cash, but it is burning through roughly $1 billion a quarter as it embarks on one of the most daunting gambits in automotive history: taking production of its mass-market vehicle from zero to 400,000 or more a year in just 18 months.

Fortunately for Mr. Musk, investors can’t seem to shower his ambitions with too much money. Tesla’s stock has risen by 67 percent this year. The company is valued at some 27 times 2020 earnings, implying the kind of growth that even the most bullish of analysts don’t expect, according to Reuters Breakingviews calculations.