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Analyst: I'm Downgrading Tesla, But Don't Give Up On China

Analyst: I'm Downgrading Tesla, But Don't Give Up On China
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Analysts at CLSA Americas downgraded Tesla Motors Inc (NASDAQ: TSLA) from Outperform to Underperform, discounting its price target by $55 to $220 –- still above current prices.

While the analysts explained that near-term, the stock will underperform, the "patient investor" might still find the current price attractive.

CLSA downgraded the stock based on lower-than-expected Model X margins, recent execution issues, and investor concerns around product demand. Model S margins are also more dilutive than previously thought, the analysts said.

Don't Give Up On China

On the long-term side, CLSA said investors should not give up on China just yet. Looking forward to 2016, China should come into focus, while the Model S will be added to the city of Shenzhen's new energy vehicle incentive program.

Related Link: What's Causing Tesla's Slump?

Xinhua, the Chinese government news agency, will also be using the Model S as media vehicles.

Tesla recently traded at $198.50, down 1.5 percent in the pre-market.

Image credit: Public Domain

Latest Ratings for TSLA

Oct 2016Goldman SachsMaintainsNeutral
Oct 2016Goldman SachsDowngradesBuyNeutral
Sep 2016Cowen & Co.Initiates Coverage onUnderperform

View More Analyst Ratings for TSLA
View the Latest Analyst Ratings

Posted-In: CLSA AmericasDowngrades Analyst Ratings Tech Best of Benzinga


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