Nebius Group (NasdaqGS:NBIS) just rolled out its AI Cloud 3.1 upgrade with NVIDIA Blackwell Ultra hardware and deeper capacity controls, but the real story for investors is how this shapes the cost versus scalability debate.
See our latest analysis for Nebius Group.
The launch lands after a choppy stretch, with a 1 day share price return of minus 6.8 percent and a 7 day share price return of minus 20 percent. Yet Nebius still boasts a year to date share price return above 140 percent and a 1 year total shareholder return close to 180 percent, suggesting strong long term momentum even as near term sentiment cools.
If Nebius has you thinking about where the next AI infrastructure winner might come from, it is worth scanning high growth tech and AI stocks for other fast moving contenders.
With Nebius now trading roughly 50 percent below consensus targets even after a blistering year to date rally, are investors looking at a mispriced AI infrastructure leader, or is the market already pricing in all potential future growth?
With Nebius shares last closing at $75.45 against a narrative fair value near $159, the implied upside rests on aggressive long range growth assumptions.
Hypergrowth in demand for AI compute and cloud infrastructure, as evidenced by exceptionally strong revenue growth (625% YoY, 106% QoQ) and high utilization, suggests Nebius may benefit from long-term secular trends of accelerating digital transformation and AI adoption, potentially supporting sustained revenue and ARR expansion.
Want to see what kind of revenue surge, margin lift, and future earnings multiple are baked into that upside case? The narrative spells out a bold roadmap. Curious which assumptions actually carry the valuation, and how sensitive that fair value is if just one pillar underdelivers? Read on to unpack the full playbook.
Result: Fair Value of $159.29 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, execution risks around hyperscale contracts and intensifying cloud competition could compress margins faster than expected and derail the current undervaluation thesis.
Find out about the key risks to this Nebius Group narrative.
If you are not fully convinced by this view, or prefer hands on research, you can build a personalized Nebius narrative in minutes: Do it your way.
A great starting point for your Nebius Group research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
Do not stop at a single AI story when the Simply Wall St screener can uncover other high conviction opportunities that fit your strategy and risk profile.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include NBIS.
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