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Tesla shares get a bump ahead of its annual shareholder meeting

Tesla (TSLA) shares got a bump on Monday after Roth Capital upgraded shares to “Buy” with a $238 price target, with shares up 4% at market close.

Other analysts have recently expressed a more bullish outlook ahead of the company's annual shareholder meeting on Tuesday. The positive view follows months of analysts downgrading the stock and slashing its price targets. That includes Morgan Stanley analyst Adam Jonas, who in May warned the stock could fall to just $10 in a worst-case scenario.

But in a note to investors on Monday, Roth Capital analyst Craig Irwin expressed optimism for an uptick in demand for Tesla vehicles in China — especially for its less pricey offering, the Model 3.

“Demand from China will likely be stronger than most anticipate, reducing the potential for lowered 2019 unit guidance,” Irwin said. He added that China Model 3 deliveries of 2,324 units in April, after the initial 259 deliveries in March, indicate a healthy initial ramp.

Tesla CEO Elon Musk speaks during the unveiling of the new Tesla Model Y in Hawthorne, California on March 14, 2019. (Photo by Frederic J. BROWN / AFP) (Photo credit should read FREDERIC J. BROWN/AFP/Getty Images)

Irwin’s bullish outlook for Tesla’s China business stemmed from four meetings he had with the top 10 electric vehicle producers in China, and a few of the most relevant China supply chain participants, which showed positive demand.

Despite the overall bullish sentiment, Iwrin did note that he remains “cautious” about Tesla’s longer-term growth forecasts, as rising battery costs “are likely to be a 2019 margin headwinds.”

Bridgette Webb is a producer at Yahoo Finance. Follow her on Twitter @bridgetteAwebb.

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