Tesla’s stock bounces, but Morgan Stanley says it’s still a sell No ratings yet.

Shares of Tesla Inc. shot higher Monday, putting them on track to snap a sharp 5-day selloff, but Morgan Stanley analyst Adam Jonas suggested it was still too early for investors to jump in.

Jonas reiterated the underweight rating he’s had on the stock since he downgraded it on Jan. 16, 2020. He also kept his price target at $500, which implied a 33 % drop from current levels.

The stock

TSLA, +11.32%

 rallied 11.3% to close at $743.62. It had plunged 25.8% over the previous five sessions, amid concerns over impact of the coronavirus outbreak given that the electric car maker’s China operations play a big part in its growth story. Since closing at a record $917.42 on Feb. 19, the stock had shed 27.2% through Friday.

Jonas said he would have his bearish view even without the coronavirus uncertainty, saying investors should prepare for “challenging” first-quarter data points.

“Even before fully accounting for the broader impacts of the coronavirus, we expect 1Q 2020 to be notably weak as Tesla works through the China production and Model Y ramp and deals with potentially weaker demand in certain European markets (i.e. Netherlands) after a strong 4Q and less accommodative incentive environment,” Jonas wrote in a note to clients.

Also read: Tesla’s valuation needs to be more ‘grounded’ to profit, analyst says.

Coming data points include deliveries data for March, the earnings report and the company’s “battery day” in April, which he believes could produce some volatility in the stock. Jonas expects consensus forecasts for revenue and cash flow should “come down a bit” ahead of those releases.

He recommends investors “wait and see” if a challenging first quarter and supply disruptions comes to pass before revisiting the stock.

Adding to those concerns, the “fluidity” of the COVID-19 situation made it “not possible” to forecast the impact at this point, Jonas said, given the uncertainty over the duration and severity of the impact on the supply chain, manufacturing and demand.

See related: After ‘refreshing’ month, Tesla bear predicts ‘biggest single stock bubble in this whole bubble market’ will hit zero.

Despite the recent weakness, Tesla’s stock has still more than doubled (up 122%) over the past three months, while the S&P 500 index

SPX, +4.60%

  has slipped 0.8%.

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