By Senad Karaahmetovic

Following the stock price pullbacks, Credit Suisse Analyst Dan Levy has reaffirmed his Outperform Rating on Tesla (NASDAQ).

The analyst’s $1,125.00 per share price target implies a nearly 60% upside from current levels.

His comments come after he visited TSLA’s Fremont facility with investors where he held discussions with the IR team.

“During our visit, we discussed how 2Q has played out to date in China. Mgmt pointed out that Shanghai experienced a complete month of shut downs with the largest number occurring in April. Since the 1Q call, Shanghai has operated with one shift, and mgmt notes that for Tesla to produce at two shifts with meaningful volume, Tesla’s China suppliers will also need to resume production,” Levy said in a client note.

Analyst now expects 2Q22 deliveries to be between 240 and 250k units. This is lower than his previous estimate of 295k.

Levy remains positive that Tesla’s long-term potential is still there, despite the recent challenges from China.

“While the manufacturing focus ahead for Tesla is on its new gigafactories (Shanghai, Berlin, Austin), the visit reminded us that Fremont has shown ongoing manufacturing kaizen. As for the stock, we anticipate the near-term (specifically 2Q) to reflect some regression in terms of margins and total deliveries, led by the challenges to production at Shanghai,” the analyst concluded.

The Tesla stock price rose 2.7% ahead of the New York Open.