Tesla TSLA is getting a bit of a mixed signal from Canaccord, with the firm nudging up its Q1 delivery estimate while cutting its price target as valuations across tech come back down.

The analyst now sees Tesla delivering about 370,000 vehicles in Q1, slightly higher than the earlier 367,700 estimate, and kept a Buy rating on the stock. But the price target was lowered to $420 from $520, mainly because the valuation multiple was trimmed to 37x from 46x 2028 earnings, in line with how other mega-cap names are now being valued.

Looking at demand, the picture is still uneven. China remains soft, while the U.S. and Europe are improving but not exactly strong. The rest of the world is doing better, and there are some small positives, like rising used Tesla prices and the possibility of stronger demand if gas prices stay elevated.

Longer term, the analyst isn’t backing off the story. EVs are still seen as the core driver, but there’s also growing focus on areas like autonomy, robotics, and the Terafab project, which aims to scale AI compute in a big way by 2027.