CFRA Research does not believe Tesla will be able to maintain its Model 3 production rate over the short term.

The firm lowered its rating to sell from hold for Tesla shares, citing the stock’s valuation.

Tesla said on Monday that the carmaker reached its one-week production goal of 5,000 Model 3 cars for the last week of the June quarter. But the company fell short on its second-quarter deliveries by posting 40,740 vehicles delivered versus the Wall Street consensus of approximately 51,000.

“After Herculean efforts and albeit a few hours after a self-imposed deadline, Tesla finally achieved its latest goal to reach production of 5,000 Model 3 sedans per week. In the interim, we do not see this production rate as operationally or financially sustainable,” analyst Efraim Levy said in a note to clients Monday.

Tesla shares declined 2.8 percent after the report after opening up 5 percent at the beginning of Monday’s session.

Levy reiterated his 12-month $300 price target for Tesla shares, representing 12.5 percent downside to Friday’s close.

The company’s shares are up 10 percent this year through Friday versus the S&P 500’s 2 percent gain.

Tesla did not immediately respond to a request for comment.