Tesla inventory (TLSA) is overvalued, valued at $ 150, the analyst says

Tesla’s stock is overvalued and worth only $ 150, according to Craig Irwin, senior research analyst at Roth Capital, who said the electric automaker had to do more to justify its nearly $ 700 share price.

Tesla shares closed at $ 691.05 overnight as investors cheered the electric car maker’s forecast shipments.

But the possibility that Tesla will beat estimates is “clearly already in the assessment,” Irwin told CNBC’s Squawk Box Asia on Tuesday. The company’s valuation of roughly $ 660 billion is roughly the size of the US and European auto markets overall, though it is only a “small player,” the analyst said.

“To me, this is a market shift, an avoidance of fundamental analysis, and I think there is room for a lot of successful companies in the market. People are just assuming Tesla has no competition if they put this kind of thing on.” the high valuation of the company, “said Irwin.

Still, Irwin said he was optimistic about the outlook for sales of electric vehicles, in which Tesla is the market leader.

Tesla reported Friday that it delivered 184,800 vehicles and produced 180,338 cars in the first quarter of 2021. Analysts had expected the company to deliver around 168,000 vehicles as of April 1, according to FactSet estimates.

The company’s shares even rose 7% on Monday.

Irwin said there are “good things” for Tesla. He cited expected entry in India and prospects in China as factors supporting Tesla’s prospects.

However, the company has a lot more to do to justify its current share price of nearly $ 700, Irwin said.

“They’d really have to deliver the robotic axis, the fully autonomous vehicles,” the analyst said, adding that Tesla appears to be pulling back on its efforts in this area while other companies come out with “far superior technology.”

– CNBC’s Lora Kolodny and Katrina Bishop contributed to this report.