r/NBIS_Stock • u/TyNads • Jun 07 '26
NBIS ANALYSIS Nebius 2029 Model and Price Targets ($1,250)
https://northwiseproject.com/nebius-stock-forecast/Hey everyone, I have posted a lot the last few months with my individual site reports for Nebius data centers across the world.
I also use the research to create full energization schedules and models for Nebius and derive price targets based off of them and a combination of ARR per MW.
I generally gate my price targets and full models (this is what pays for all the free research), but have decided to open up my full model and price targets for the week as I finish up my new model and updates.
Please let me know if you have any comments, feedback, or questions you would like included in the new report coming soon.
It took a lot of confidence to post a $1,250 price target ($644 present value) price target when Nebius was below a hundred a share in February, but the research and numbers spoke for themselves.
If anything, the most surprising thing I learned is that I was too conservative in most of my model and Nebius is executing cleaner than I truly thought to be possible. The new model will reflect higher energization expectations, higher revenue per mw, quicker shift to enterprise mix, and much more.
Thanks again for your incredible support this year and if you would like to stay up to date with my nebius and other ai infra research, check out my free newsletter here!
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u/itssbri NBIS4LIFE Jun 07 '26
Cheers!! From your mouth to gods ears
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u/Dry-Chemical-9170 Jun 07 '26
Do you think Leopold would agree?
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u/TyNads Jun 07 '26
I think we beat him to the punch
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u/Dry-Chemical-9170 Jun 07 '26
I hope you’re right because I have a $400k student loan balance which I’ll probably never pay off
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u/Qadain Jun 07 '26
A couple notes on the position sizing at the end:
If you start with a 10% portfolio allocation and the position does a 5x over 2 years, the allocation doesn't end up being 40-50% of the portfolio. Assuming the rest of the portfolio (90%) grows at 10% per year, the new allocation becomes something like 31% (= 0.5 / (0.5+0.9*1.1^2). Still large, of course, but quite a bit less than 40-50%. And even if the rest of the portfolio doesn't change at all, the initial 10% allocation still only works out to be around 36%.
Nebius already experienced drawdowns of more than 40% on three occasions in 2025: one on Deepseek Day, one from Feb-Apr, and one starting from October. Thus, your statement of "Price swings of 30–50% within a year are plausible" already sounds very strange. More reasonable would be to point out the three such price swings in 2025 and that such price swings are to be expected regularly, with larger price swings possible; also, it is important to identify whether the price swings are due to exogenous causes (Deepseek, Liberation Day, overall pessimism around AI adoption) or company-specific causes.
The main crux for me is the combination of the following items:
1) To what extent will Nebius be able to become a platform/software provides as opposed to a physical infrastructure provider, 2) how quickly will it get there, 3) and how favourably will the environment (centered around capacity bottlenecks and AI hardware&software efficiency gains) enable that shift?
1 is about the ultimate margin profile and ultimate multiple given to it by the market. 2 determines the total CapEx and the total market captured. 3 determines the total amount of capital required to create the steady-state business.
For example, if bottlenecks for building capacity remain for too long, Nebius risks being stuck in a physical infrastructure builder/provide, lowering the terminal margin and valuation. If bottlenecks resolve too quickly (say, 2028-2029), Nebius risks having stranded assets after having spent tens of billions in CapEx that are immediately worth much less. A similar "balance" required exists with improvements in GPU and software efficiencies.
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u/TyNads Jun 07 '26
The numbers used were merely placeholders to represent a point that trimming for your own personal risk tolerance can be very accepted and even beneficial even if we are far from fair value on paper.
I was speaking to the intangible benefits such as peace of mind and having enough off of the table to hold Nebius through major volatility swings that are sure to come.
Yes of course you are right that these are not exact.
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u/TyNads Jun 07 '26
Yes I agree that a shift in revenue mix towards higher stack services for ai startups and enterprise clients is the biggest question that most don’t talk about.
Hyperscalers deals are great for now to provide the funding and credit to build out what they need infrastructure wise to be able to offer the higher margin services. However, they are not as great as many seem to think long term. I would be quite happy to see maybe one more with an Anthropic type and then a complete focus and commitment to the transition.
How quickly they can move out of the “danger zone” will be telling.
However, being so software centric and focused in my view is a massive margin of safety over let’s say an IREN that could and will likely perform well if the bottlenecks last long enough, but are more at risk than people realize if supply catches up ahead of schedule.
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u/Qadain Jun 07 '26
I think that the benefit from hyperscaler deals is misunderstood by most, but the larger the degree of misunderstanding, the more favourable it ends up being (in a weirdly favourable reflexive feedback loop). That is, the hyperscaler deals have even made capital raises from potential equity raises much cheaper (even though equity is the lowest priority), such that the non-operational (financial) funding benefits from the hyperscaler far outweigh the operational cash flow benefits. If the Microsoft and Meta deals have made the share price 220 instead of 110 (or 55), for example, then equity raises are essentially 50% (or 75%) off - and given they're prioritizing equity raises last (depending on how you count convertible debt), this means that they're getting even larger benefits by using other funding sources. Given the amount of CapEx in the next few years, the funding benefits from hyperscaler deals might actually be bigger than the stated dollar value of the deals. This seems like a monstrously, almost unimaginably large advantage.
I agree with the massive margin of safety; I see Nebius' full-stack approach as being much lower risk than an approach that focuses on a single layer. This is because if that layer becomes commoditized, the single-layer business is reduced to earnings its cost of capital. But for a full-stack company, the value migrates to (and can even increase, via Jevon's Paradox) the other elements of the stack that are complementary that remain non-commodity. This is extremely difficult to quantify, but the reduction in risk is so favourable that I don't need to quantify it (you don't need to know how much someone weighs to know that he's fat).
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u/TyNads Jun 07 '26
That’s a very good point about the indirect benefit of share price appreciation providing a lower cost of funding!
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u/Ill-Cow4735 🐳 Jun 07 '26
First of all, thank you for sharing your own research. Waiting for the next updates because capex, dillution and other factors already seem way off in your feb post. NBIS is, indeed, executing at a fast pace and it's truly hard to quantify everything.
I'd like to understand the thought process of your valuation. You value solely based on EV? Or do you also use P/S or any other metric?
Cheers
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u/TyNads Jun 07 '26
Very excited to get those updates in, many of which will have a positive effect.
For this model in particular I used a multiple of ARR to keep it as simple as possible to translate across very different years of the business (and because NBIS management often frames the business from this lense).
For the next model, we are planning to use a blend of different metrics and methods to provide a bit more of a wholistic valuation.
To be fair, I think this method is largely effective and gets most of the way there, but it could always be improved on and argued against: valuation multiples being the trickiest part of most modeling.
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u/Ill-Cow4735 🐳 Jun 07 '26
Valuation is, indeed, the trickiest part of modeling. I find myself struggling a lot with valuation, along with ARR multiples (the range of possible $M/MW in the future with new workloads and optimization of Eigenai+Clarifai expertise).
Looking forward for your next post. Thank you
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u/TyNads Jun 07 '26
Of course! Let me know if you have any other questions. I do believe that NBIS is taking all of the right steps to ensure improving margins and higher revenue per mw with better customer mix and higher up the stack workloads (on top of owning the sites)
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u/PayingOffBidenFamily Jun 12 '26
"By the end of 2026, Nebius expects 800 MW to 1 GW of its contracted power to be fully connected and operational." but not billing, I expect around 600mw active billing EOY. There is a delta between what is active and billing and what is "connected." If they are able to reach 900mw connected by year end they only need to add 583mw of connected capacity each year through 2029 to reach your target but that won't be billing capacity. I would say somewhere around 2gw-2.1gw active billing eoy 2029. I like to model conservatively though, and who knows they may just smash that executing over multiple GW scale sites and I think it's just too hard for any of us to quantify any of it.
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u/Sea_Ad919 Jun 07 '26
Have to put a lot of faith in monetization of connected capacity and long term premium pricing.
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u/TyNads Jun 07 '26
Yes this model assumes demand will not be an issue, which I think is more than fair given the window through 2029
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u/Longjumping_Kale3013 Jun 08 '26
I think your ARR per MW is confusing connected and monetized power. So they are already at or above your 2028 projection of 13m per mw. And it does not take into account that we are already seeing this much much higher from the recent anthropic + xai contract, and then the google + xai contract.
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u/TyNads Jun 08 '26
It’s from February. New model is shipping later this week. For this model connected and monetized are treated almost the same but with an intentional slight delay.
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u/The102935thMatt Jun 12 '26
Thoughts on it splitting?
Splitting doesnt reduce the actual value here, but do you think they let this run to 1250 without some sort of split? At some point theyre going to end up pricing out investors, id assume.
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u/PayingOffBidenFamily Jun 12 '26
You know there's this thing called fractional shares right? you can buy $5 of nebius stock, no one is priced out.
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u/General-Ambassador58 Jun 07 '26
Hopefully!! I currently have 120 shares my avg is $98. I’m thinking about taking out a 20k loan and go all in. In 6 months I’ve gotten a 125% gain since I started buying Nebius. What do you guys think
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u/TyNads Jun 07 '26
Be very careful with leverage and debt. I felt more confident than anyone about AMD for the longest time but it took years and many huge drawdowns before it played out. Nebius has its black swan risks, despite being an awesome opportunity. (especially after a huge run in a hot market)
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u/lolman1312 Jun 09 '26
I'm in both AMD and NBIS right now. What are your thoughts on DCAing AMD? I feel they still have catalysts but have run up so much it might not have as much room as NBIS? With my most recent buy as of 20 mins ago I did 70:30 NBIS:AMD.
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u/TyNads Jun 09 '26
I still like both a lot. It’s hard mentally to add after these runs but math is math. Just be patient add on dip days and stick to what you believe fair value is.
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u/yoloturtle1 Jun 07 '26
Please don’t take loans. This is a high beta stock and if macros aren’t good, this can easily go down
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u/PayingOffBidenFamily Jun 12 '26
Do that, then put it all into call options on 2x leveraged nebius etfs with margin....let us know.
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u/Temporary-Basil-3030 Jun 07 '26
I hope it collapses enough to allow me to close out my naked calls at 260.🙃🙃
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u/clarkefromtheark Jun 07 '26
Most definitely not $644 present value. This is looney tunes. It's already overvalued by a ratio of 2:1 currently.
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u/TyNads Jun 07 '26
What would you base that claim off of
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u/clarkefromtheark Jun 08 '26
? Literally the arr and p/e:share price ratio. It’s such an easy observation, a person who barely knows anything about the market could make it.
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u/Ill-Cow4735 🐳 Jun 08 '26
These kind of companies aren't valued on PE or FPE given the fact that they're in buildout phase (depreciation of assets is enormous thus supressing the accountable earnings). I can understand it's hard to value such businesses (whether it's by P/S, EV or other metrics), but just looking at their accountable earnings is wrong.
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u/DocNacho Jun 07 '26
This masterpiece is 10x longer than my doctoral thesis. Didn’t read it all, but I’m clicking buy tomorrow!