Top analyst: SolarCity has 'very little value'

Workers secure solar panels to a rooftop during a SolarCity Corp. residential installation.
Sergio Flores | Bloomberg | Getty Images

One of Wall Street's top analysts reiterated his sell rating on SolarCity after Tesla's bid Tuesday.

"As we fail to fully grasp the rationale behind TSLA's proposed acquisition of SCTY, we believe yesterday's announcement suggests SolarCity has very little value," Axiom's Gordon Johnson wrote in a note to clients Wednesday.

He added, "The proposed premium to SCTY's stock price ... is still -44.6% below the stock's avg. price of $49.6 during '15 & just +2.8% above the stock's avg. price of $26.7 in YTD '16 – in other words, if TSLA truly believes in SCTY, then why such a modest premium?"

Johnson's picks have a 12.5 percent one-year average return, according to analyst ranking service TipRanks, placing him in the top 5 percent of all Wall Street analysts covering any industry.