Nebius Group (NBIS) Shrugs Off Q3 Selloff as Price Targets Eye $160

Nebius Group (NBIS) just delivered 355% YoY revenue growth and a $3B Meta deal, and despite a selloff on expectations miss, it remains a smart risk-on bet if its international expansion can ease data-center power constraints.

Nebius Group (NBIS) is rapidly scaling as a global AI-cloud operator, earning a reputation for sharp, strategically timed international diversification across Europe, the Middle East, and the U.S. The company has demonstrated an ability to enter new regions ahead of major competitors, securing power, land, and supply-chain advantages before the market becomes saturated.

However, my strongest conviction lies in Nebius’ potential to move into markets that aren’t yet dominating mainstream headlines—regions such as the Nordic and Baltic countries, Latin America, and Australia. These geographies offer a mix of underutilized energy resources, growing demand for AI infrastructure, and governments actively seeking tech investment. If Nebius executes well, it could capture early-mover advantages that larger hyperscalers often overlook until much later.

With power and supply-chain constraints tightening across the AI sector, Nebius’ international footprint and flexibility give it a unique ability to sidestep chokepoints that limit other providers. Rather than being boxed in by today’s “AI-bubble” narratives, Nebius appears positioned to outmaneuver them—expanding globally while others are struggling just to maintain build-out momentum.

Q3 Results Show Big Ambitions Paying Off

The company reported outstanding top-line growth in Q3, as announced on November 11, with revenue up 355% year-over-year, as it continues to scale its AI compute clusters across multiple regions. A newly announced five-year, $3 billion deal with Meta Platforms (META) also revealed one of its most significant contracts yet and showed continued support from Big Tech players, with a $17.4 billion deal with Microsoft (MSFT) already in place.

Even with such outstanding top-line growth, the company’s losses are widening as it focuses on scaling its market presence rather than generating profits. The net loss was $120 million for the quarter, compared to $43.6 million last year, as investment ramped up to meet demand. Importantly, the company stated that it has “sold out available capacity” this quarter, indicating that demand is exceeding its current infrastructure. 

The fact that Nebius is running out of capacity is a clear indicator that semiconductor companies could face an unfortunate glut soon if infrastructure development and power procurement cannot keep pace with the demand for cloud services. That’s why I think Nebius will start seeking cheaper and less strained energy regions in the near future, opening the door for faster and more reliable scaling amid a competitive energy grid in the U.S. and Europe. That’s a big potential reason to stay bullish. 

The Bull Case of Broad International Diversification

Management’s most logical next step beyond its existing data center presence in Finland, Israel, the U.K., and the U.S. would be to expand further into the Nordics—particularly Sweden, Norway, and Estonia in the Baltics—where power grids are over 90% renewable and electricity costs remain among the lowest in the world.

Looking further out, Australia and Latin America present compelling long-term opportunities: Australia for its Five Eyes alignment and advanced security-compliance environment, and Latin America for its low construction costs and ample access to affordable energy.

Technically, the stock is well-positioned at present, as it trades around $100 per share, which is roughly 30% below my 12-month base-case price target of $132.50, based on a blend of growth momentum and scaling potential. Nebius is trading under its 50-day moving average, and the 14-day RSI is currently 40. That means that the stock is undervalued and a definite buying opportunity in my eyes.  

The bullish case could be much stronger if hyperscalers develop international alliances faster in currently under-tapped regions. Doing so could see the stock rise to $170 in 12 months, a >70% gain, which is grossly overshadowed by the stock’s 260% return year-to-date, but still would be remarkable.

Time to Read the Writing on the Wall

Although I’m bullish, the bear case must be acknowledged. Michael Burry, the legendary fund manager who correctly shorted the 2008 financial crisis, is currently placing significant bets against AI, with massive put options on Nvidia (NVDA) and Palantir (PLTR).

Additionally, his call options on Halliburton (HAL), a U.S. energy company, indicate that he recognizes energy constraints as the primary gating factor. If Nebius doesn’t manage to consolidate power in new markets, then it is pretty likely that a cyclical decline could be on the cards for the near future. 

That’s why I don’t have all my eggs in the AI basket, and I’m diversified across healthcare, European defense, online retail, automotive, and, of course, my major hedge, a 20% cash position.

Is Nebius Group a Good Stock to Buy?

Nebius currently carries a Strong Buy consensus on Wall Street, supported by four Buy ratings, one Hold, and zero Sells. Analysts see substantial upside ahead: the average price target of $157 implies a powerful 77% gain over the next 12 months. Even the most conservative target, at $130, points to a compelling return of more than 30%—underscoring that investors entering the stock below $100 per share could be positioned for exceptional rewards.

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NBIS is a Generational Investment Impossible to Ignore

The AI market may currently feel saturated with risk, but the best opportunities often emerge when sentiment is clouded by uncertainty. While a broader AI correction is possible, I believe the macro environment still offers pathways to avoid a severe drawdown.

More importantly, the long-term secular AI trend remains unmistakably intact and will continue to drive growth well beyond today’s scaling challenges. In my view, staying bullish on Nebius at this stage makes strategic sense—positioning investors for significantly greater long-term upside than if they sit on the sidelines out of fear.