It's time to take some profits after Tesla's recent rally, Barclays said Wednesday.
After seeing some downward pressure following its first-quarter earnings report in April, Tesla has surged 80% from that month's lows.
"We believe the stock's recent rally can be best explained by the market's current AI-driven thematic trade, as well as excitement over recent announcements to open the TSLA Supercharger network to other brands," he said in a note to clients Wednesday.
"Yet while we aren't surprised that the stock has participated in the rally, we believe it is prudent to move to the sidelines."
But he said right now, fundamentals may be overlooked as investors buy into stocks with exposure to artificial intelligence amid skyrocketing interest in the technology.
Persons:
Dan Levy, Tesla, Levy, there's, Linda Yaccarino, — CNBC's Michael Bloom
Organizations:
Barclays, Nasdaq, Nvidia, CNBC