One Reason Tesla (TSLA) Stock Is Trading in the Red

NEW YORK (TheStreet) -- Shares of Tesla Motors Inc  (TSLA) are lower by 0.31% to $248.08 in late morning trading Monday, after analysts at CLSA issued a negative note this morning saying challenges in China remain for the electric car maker.

Following the firm's checks in China, CLSA found that Tesla's sales pace has not improved despite its strategy shift. Analysts said inventories in China remain elevated.

The firm noted that Tesla needs to invest further in marketing to increase awareness.

CLSA's industry contacts stressed the need for Tesla to educate the Chinese consumer about electric vehicles and charging.

CLSA kept its "underperform" rating, citing concerns that challenges this year will limit upside potential in Tesla shares.

Separately,TheStreet Ratings team rates TESLA MOTORS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate TESLA MOTORS INC (TSLA) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

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