Tesla, Inc. (NASDAQ: TSLA) is off to a bumpy start to 2019, and one Wall Street bear lowered his price target Friday after meeting with Tesla management.

The Analyst

JPMorgan analyst Ryan Brinkman reiterated his Underperform rating for Tesla and lowered his price target from $230 to $215.

The Thesis

After speaking with Tesla director of investor relations Martin Viecha as part of JPMorgan’s recent European auto industry tour, Brinkman said Tesla simply has too many headwinds at the moment:

While Tesla demand throughout Europe may be higher than some investors realize, Brinkman said the company’s brand perception isn’t nearly as strong as it is in the U.S.

The first quarter of 2019 will likely be a low water mark for cash flow this year given heavy investments by the company.

Any delays in Model 3 deliveries in China and Europe will impact first-quarter numbers.

Labeling problems in China and a dockworkers strike in Europe likely delayed Model 3 shipments more than Tesla had anticipated in the first quarter.

Standard versions of the Model 3 generate much lower margins and cash flow than higher-priced versions, although management was adamant that the low-priced version was not introduced until Tesla was convinced it could be at east break-even.

The $3,000 or $8,000 Autopilot take rates on the standard Model 3’s will likely significantly lag take rates on the Model X and Model S.

Model 3 average selling prices are expected to drop quarter-over-quarter in the first quarter.

Following the meetings, Brinkman cut his first-quarter total deliveries estimate from 75,500 vehicles to 70,500 vehicles, below consensus estimates of 74,930. Brinkman also cut his full-year 2019 EPS estimate from $4.75 to $4.50.

“Valuation appears to be pricing in upside related to expansion into mass-market segments well beyond our volume forecasts for the Model 3,” he wrote in the note.

Price Action

Tesla's stock traded around $278 per share Friday morning and remains down 16.4 percent overall in the past three months.

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