Barclays cut its price target on Tesla on Thursday and said the market is finally coming around to the firm's thesis on the automaker.

The firm also said Tesla is "stalling as a niche automaker," and cut its 12-month price target to $150 from $192.

"Model 3 demand is stagnating in the US, the company still doesn't have a path to significant auto profitability and solar storage installations have declined sequentially over the past two quarters," analyst Brian Johnson said.

"While Mr. [Elon] Musk is pivoting to the remaining 'hyberbull' full robotaxi scenario, his efforts to spring excitement around Tesla's full self-driving capabilities was broadly met with the appropriate skepticism. We expect more investors to gravitate back to Tesla's near-term fundamentals of demand, profitability, and cash generation, areas that are now more exposed as the blue pill thesis washes away."

Tesla stock is down 1.03% in early market trading. The shares are down by 40% this year and 20% this month alone as investors raise questions about the company's ability to deal with rising costs even after a capital raise. CEO Musk sent an email to employees on Monday asking them to control costs and that the second quarter could be a record for vehicle deliveries "if we execute well."