Long considered one of the most bullish analysts on Tesla, Morgan Stanley's Adam Jonas said Monday he sees signs that the automaker will face tougher growth prospects in coming years.
In a note to investors, Jonas cut his price target on Tesla shares to $333 from $450, citing lower sales estimates, greater competition and low energy prices.
Still, he maintained an "overweight" rating on the stock, and remains far more optimistic about Tesla than most other analysts. In fact, his price target of $333 is still $49 higher than the Wall Street average, according to Thomson First Call.
As such, the automaker's shares were trading more than 2 percent higher, at $196, despite the cut.
"We are lowering our price target by 26 percent to reflect our lowered volume expectations for Model X and Model 3, a lower valuation for Tesla Energy, and accelerating competition in the mobility business," Jonas said.
Below are more details on why Jonas has turned more cautious on Tesla.