Having taken hits recently, two key components of Elon Musk’s empire are under pressure which some analysts believe, won’t see relief in sight anytime soon.

Share prices have fallen for Musk’s co-founded companies – SolarCity and Tesla Motors. Despite a warm reception for its Model 3 Tesla is down more than 16 percent in the past month alone. Tesla was once a darling of Wall Street. O the other hand after quarterly earnings fell short of market estimates, SolarCity was walloped this week.

The luxury automaker will be facing some stiff competition in the next few years from Mercedes, Porsche and Audi, opines UBS auto analyst Colin Langan, who has a “sell” rating on the Tesla. Porsche, Audi and BMW is also pushing to get a luxury electric sedan on the road by 2021.

Langan believes Tesla is overvalued for those reasons. The company’s aggressive production target of 500,000 cars by the end of 2018 is also an issue according to him. Tesla’s own estimates for production were bullish. Its mass-market car expected to hit in 2017, Model 3, is expected to generate demand.

“That’s a very aggressive target, even for any established automaker, so I think that’s very tough to achieve and that’s going to put the stock at risk,” he said in a recent interview with CNBC’s “Power Lunch”.

“And there’s a question of can they actually continue to grow, given they already have actually pretty good share in the high-end luxury sedan segment,” he added.

There are not a lot of catalysts for the electric carmaker, even as it moves ahead with its hotly anticipated battery factory admitted Tesla shareholder Drew Cupps, chief investment officer of Cupps Capital Management.

“We’re going to keep ramping the [Model] X. We’re going to keep making progress with the gigafactory. I suspect we’re going to get financing in here. Maybe sooner rather than later, all those things, I think, will tend to be positive for the stock,” he told “Power Lunch.”

After the company reported a wider-than-expected quarter loss and gave disappointing guidance, there was a plunge in SolarCity as well. The solar power company is down about 63 percent year to date.

“The real problem is this is a company that had massive growth, from 2013 to 2015, over 5,000 percent compounded annual growth. Then in 2015 the growth started to slow,” said Gordon Johnson, managing director at Axiom Capital.

The company’s play on words could be the issue according to him.

“They are defining things differently than you typically define things in economics. One of the major problems is they’ve redefined how you calculate their costs; they’ve redefined how you should look at their revenue,” he explained.

“You have a business where you burn a ton of money but you just issue debt, and that means you are generating cash. And that is really the concern that investors have,” he added.

(Adapted from CNBC)

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