Even analysts who are bullish on Tesla Motors Inc (NASDAQ:TSLA) think the automaker’s stock is getting ahead of itself. Recently Tesla CEO Elon Musk said (for the second time) that he felt like the company’s stock price is getting a bit too high. Now Morgan Stanley analysts say they agree, although they stand behind their $320 per share price target.

Tesla Motors Inc Stock Gets Killed After Morgan Stanley Report

Tesla not worth $320 just yet

In a report dated Sept. 15, 2014, well-known Tesla Motors Inc (NASDAQ:TSLA) bull Adam Jonas and his team said it’s too early for the company’s shares to hit their target price yet. However, they kept their Overweight rating and $320 per share price target on Tesla.

They believe the reasons for Tesla’s stock price increase are not the right reasons to send shares so high. They point to several “sobering factors” investors should consider.

Tesla leads EV manufacturers… for now

For example, they note that so far, electric vehicles in general just aren’t doing as well. Tesla has been the only EV maker to see any kind of major success. They also expect the auto industry to push for some major revisions to current requirements under the California Air Resources Board’s guidelines because major automakers just can’t keep up with the pace set out in those guidelines.

This will impact electric vehicle sales, but the Morgan Stanley team notes that Tesla Motors has been making vehicles that interest consumers on their own merits rather than just on being electric cars.

Volume expectations for Tesla

Also they think demand for Tesla’s cars in China could be “severely limited” over the next several quarters or possible even years. Infrastructure presents a major barrier to the country, as well as local business practices and “impeded technology enablers.”

The Morgan Stanley team continues to see Tesla Motors Inc (NASDAQ:TSLA) as a niche player rather than a mass manufacturer. They note that investors’ expectations for volume often exceed theirs due to the benefits of the gigafactory on the cost of battery cells. They think Tesla may hit 371,000 units by 2020, which is at least one of the lowest on Wall Street.