Bernstein analyst Tony Sacconaghi says Tesla shares are far too expensive to recommend after more than tripling in 2020.
The firm lowered its Tesla stock rating to "underperform" from "market perform" on Tuesday.
It maintained a $900 price target, implying that shares will tumble 42% over the next year.
Tesla recently beat earnings and crept closer to inclusion in the S&P 500.
Sacconaghi said its valuation "is mind-boggling," the analyst wrote.
Teslas' risks include slowed profit growth, a delayed product pipeline, and market rotation to value stocks stand to drag prices lower, he added.