Tesla has shown it presents a significant risk to legacy automakers as the electric vehicle market grows more crowded, Oppenheimer analyst Colin Rusch told CNBC on Monday.

Rusch became the biggest Tesla bull on Wall Street earlier in the day, when he raised his price target on the stock by nearly 60% to $612 per share.

"Tesla has really proven to be an existential threat for those companies," Rusch said while explaining his price hike on "Power Lunch."

Rusch specifically referenced the message sent by Tesla with its new Gigafactory 3 in Shanghai, which was built in 10 months. It began delivering cars made there at the end of 2019 and has reportedly increased production to more than 1,000 vehicles per week.

"First ground to first car was less than a year. I think that put a lot of automakers on notice," Rusch said.

Shares of Tesla soared past $500 for the first time ever Monday en route to a new all-time intraday high of

$522.68. The stock is up more than 8% from where it closed Friday, and it's risen more than 100% since late September.

Although electric vehicles still represent a small share of global sales, companies such as Ford and General Motors have ambitious investment plans as they seek to rival Tesla.

By 2022, Ford has said, it intends to spend $11 billion in developing more than three dozen new all-electric and hybrid models.

GM recently announced its intentions to bring back the Hummer with an all-electric pickup version as it accelerates its push to have at least 20 new electric vehicles globally by 2023.

Tesla, though, is the best-known maker of electric vehicles, and its market capitalization is above $90 billion — which is more than $3 billion larger than Ford and GM combined.

Tesla's Model 3 was the bestselling electric vehicle in the world in the first 11 months of 2019, and its entrance in China is notable because the country is the largest market for autos globally.

Many automakers, including Volkswagen, view China as a sort of launch pad for their electric vehicles, CNBC reported in April.

In researching the electric vehicle market ahead of its price hike, Rusch said, significant attention was paid toward the designs of cars released by competitors.

"And what we were looking at is designs very similar to the Tesla Model 3 coming out two, three years from now," he said.

"So our conclusion is that, given some time, Tesla having a little more risk tolerance as an organization and being able to learn from its mistakes, that they're going to continue to evolve ahead of their competition," Rusch said.

He also said Tesla's significant number of electric vehicles on the road — more than 600,000, he said — could give it a massive data advantage over rivals as autonomous vehicle development matures.

Asked specifically about the significant — and specific — price target increase, Rusch said, "You want to measure twice and cut once on this sort of decision."