Tesla's stock is overdue for a downshift into neutral after a sizzling 54% year-to-date run, warns one Wall Street analyst.

Berenberg analyst Adrian Yanoshik slashed his rating on the stock to hold from buy on Wednesday, citing mostly valuation relative to when bets on a cheaper new vehicle model and other technologies would bear fruit.

"We downgrade our rating to Hold now that our Buy thesis – based on misplaced fears of a price war – appears to have been accepted by the market," Yanoshik said. "We argued that Tesla can take market share at a gross margin of c25% (excluding credits), which indeed is where we see investor expectations heading for 2024."

Shares of the EV maker fell more than 1% in pre-market trading.

The downgrade comes on the heels of a mixed week or so of news for Tesla, as Yahoo Finance's Pras Subramanian reports. Tesla's overhyped investor day underwhelmed the masses as it didn't unveil a speculated cheaper new model. Then, the company cut prices again to stoke demand — this time on the high-end Model X and Model S. Early Wednesday morning, the National Highway Traffic Safety Administration also announced a probe into the Model Y related to a potential steering-wheel issue.

To that end, Yanoshik's Tesla downgrade makes a couple of key points for investors to consider:

#1: Tesla's Valuation Isn't Cheap

Tesla's stock trades at a forward price-to-earnings ratio of 46 times, compared to 20 times for the S&P 500, as investors bake in above-market growth rates for the EV beast.

But with interest rates headed higher and competition from Ford (F) and General Motors (GM) rising, Tesla's valuation leaves little room for error operationally, Yanoshik pointed out.

"Valuation now leaves less room for disappointment," Yanoshik says.

#2: There Is No $25,000 Tesla Yet

Investors have been clamoring for a cheaper "Model 2" from Tesla under the $30,000 price point. Musk has teased Tesla is working on it, but acknowledges it will take time as it tries to bring down battery and other production costs further.

Yanoshik thinks investors need to adjust their timeline on when a cheaper Tesla will arrive and start contributing to profits.

"New vehicle segment may boost market size by 75% but likely to take time: Moving into a smaller vehicle segment would open up a significant volume opportunity. It could expand Tesla’s total addressable market (TAM) by [$1 trillion excluding credits], which is 75% larger based on our forecast of market size in 2026. We model a slow rollout in the segment, however, not breaking through a 1 million vehicle delivery run-rate (roughly our 2023E Model Y volume) until 2028," Yanoshik notes.