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One of Tesla's biggest bulls is suddenly less bullish

Long-time Tesla bull Dan Ives sees a little less horsepower behind the EV maker's stock.

The Wedbush Securities managing director slashed his price target on Tesla to $1,000 from $1,400 in a new note out on Thursday while maintaining an outperform rating.

"The success of the China story on both the supply and demand side are the linchpins to our long term bull thesis in Tesla," Ives wrote. "That said, the reality is the current Shanghai lockdowns have been an epic disaster so far in the June quarter and we expect Tesla to see modest delivery softness this quarter with a slower growth trajectory in the key China region into the second half."

Tesla stock, the second most active ticker on the Yahoo Finance platform, was up slightly in midday trading on Thursday.

Ives's more muted stance on Tesla is logical given the importance of the China market to the company and recent sales trends from the region.

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Tesla only sold 1,512 cars in China in April, a 98% plunge from March, according to fresh data from the China Passenger Car Association. The declines reflect the heavy impact from the country's zero-tolerance COVID-19 lockdown, which has hurt everything from making cars at Tesla to getting enough chips to deliver products at Cisco.

The data also showed Tesla's production in China dropped 81% to 10,757 in April. Tesla didn't export any autos from Shanghai in the month. In March, it exported 60.

"We expect weak China sales this quarter with some spillover into 3Q," Ives wrote. "While Tesla should be able to ramp aggressively into the second half within the China region on the production front, with the zero Covid policy looming there will likely be some bumps in the road over the coming months as well."

Tesla China-made Model 3 vehicles are seen during a delivery event at its factory in Shanghai, China January 7, 2020. REUTERS/Aly Song
Tesla China-made Model 3 vehicles are seen during a delivery event at its factory in Shanghai, China January 7, 2020. REUTERS/Aly Song (Aly Song / reuters)

The veteran analyst also flagged CEO Elon Musk's ongoing battle to buy Twitter as a distraction that could continue weighing on the stock. Tesla shares have shed 33% since Musk revealed his stake in the social media platform back in early April.

"While the Twitter situation in theory does not impact the Tesla fundamental story," Ives noted, "the distraction risks for Musk (perception is reality) are hard to ignore at a time that the Tesla ecosystem have never needed Musk more with the worst supply chain crisis seen in modern history."

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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