Tesla Motors Inc (NASDAQ:TSLA) has seen price targets on its shares multiply since it released its first quarter earnings report earlier in May. Bank of America Corp. (NYSE:BAC) has been consistently bearish on the company, giving it a price target of $36 last week. A new report puts the firm’s hopes a little higher, but not by much.

Tesla Motors

Tesla Motors Inc (TSLA) Stock Prediction

Bank of America Corp. (NYSE:BAC) thinks that in twelve months’ time, Tesla Motors Inc (NASDAQ:TSLA) stock should be worth $39. The bank is raising its estimation of Tesla based on the company’s debt deal, which the analysts think should increase the amount of money Tesla has available for capital spending, and it thinks the deal, with its associated expense, will bring headwinds to the firm’s EPS.

Bank of America (NYSE:BAC) tends to produce much lower target prices for Tesla Motors Inc (NASDAQ:TSLA) because it values the company in the relatively short term. The company’s $39 price target represents a 12X multiple on expected 2014 earnings. Other analysts are not being quite that conservative, and are instead valuing the company based on performance in the next decade or more.

What this means is that Bank of America Corp. (NYSE:BAC) does not believe that Tesla Motors Inc (NASDAQ:TSLA) has the kind of disruptive force that others in the market have been talking up for most of 2013. The bank believes that the automaker’s current run of strong form is a bubble, and it will sink back down as investors begin to realize the gap with the fundamentals.

The report calls Tesla Motors Inc (NASDAQ:TSLA) shares “vastly overvalued,” an opinion that the bank has held since the firm’s shares began to sky rocket in April. Investors who really believe in the company’s mission will not be shaken by this belief, as it does not really address the central contention. The argument is about whether or not Tesla can change the way the auto industry operates.

Tesla Motors Inc (NASDAQ:TSLA)’s capital raise is not the golden dawn that will allow increased capital expenditure and a quicker route toward mass market sales that others are envisioning to the analysts behind this report. The Bank of America analysts believe that the capital raise is “a positive move that should provide additional balance sheet cushion.”

Bank of America analysts refuse to see Tesla Motors Inc (NASDAQ:TSLA) in any sort of romantic light, and that’s why they’re discounting the stock.