Analysts at Barclays sent mixed messages on Tesla Inc (NASDAQ:TSLA) in a note Wednesday, downgrading the electric carmaker after a rally it called “too sharp” but raising its price target nonetheless.
The firm lowered its rating to Equal Weight from Overweight but upped its price target to $260 from $220. Tesla shares traded nearly 3% lower Wednesday morning at $266.45.
The crux of that discord is Tesla’s recent benefit from a rally in the tech sector, as well as optimism that the company will make its Supercharger network to available to other brands.
“While we aren’t surprised that the stock has participated in the rally, we believe it is prudent to move to the sidelines,” analysts wrote.
“To be clear, we see significant long-term opportunity for Tesla - a view which underpinned our prior Overweight rating,” they added. “We continue to see TSLA as the long-term winner amongst OEMs in the race to an EV world, with a strong ‘balance of the two clocks.’”
Despite this, there are near-term concerns.
“The relative disregard of challenges to near-term Tesla fundamentals amid the sharp rally is our key concern on the stock, and at the core of our downgrade to an EW rating,” analysts wrote. “We see a number of underlying weak points in the near-term Tesla narrative.”
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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