Northern Data AG (NB2) AI Stock Analysis

Compare

27 Followers

Top Page

Northern Data AG

(XETRA:NB2)

Rating:52Neutral

Price Target:

€27.00

▼(-0.07%Downside)

Northern Data AG's overall stock score of 52 reflects its financial challenges and technical factors. The most significant factor is the company's financial performance, marked by negative profit margins and cash flow issues. Despite these, the technical analysis shows some short-term bullish momentum. Valuation remains difficult to assess due to negative earnings. Positive earnings call insights are noted but not included in the weighted score.

Northern Data AG (NB2) vs. iShares MSCI Germany ETF (EWG)

Market Cap

$1.77B

Dividend YieldN/A

Average Volume (3M)59.77K

Price to Earnings (P/E)―

Beta (1Y)1.03

Revenue GrowthN/A

EPS GrowthN/A

CountryDE

Employees157

SectorTechnology

Sector Strength82

IndustryInformation Technology Services

Share Statistics

EPS (TTM)N/A

Shares Outstanding64,196,680

10 Day Avg. Volume41,463

30 Day Avg. Volume59,769

Financial Highlights & Ratios

PEG Ratio<0.01

Price to Book (P/B)0.40

Price to Sales (P/S)0.00

P/FCF Ratio-1.44

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$39.89

Price Target Upside47.63% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Northern Data AG Business Overview & Revenue Model

Company DescriptionNorthern Data AG is a company operating in the high-performance computing (HPC) sector, focusing on providing infrastructure solutions and services. The company specializes in delivering tailored HPC solutions designed to meet the demanding computational needs of industries such as blockchain, artificial intelligence, big data analytics, and scientific research. Northern Data AG leverages its data center operations and innovative technology to support clients in managing and processing large-scale data workloads efficiently.

How the Company Makes MoneyNorthern Data AG generates revenue primarily through its high-performance computing services and data center operations. The company earns money by offering customized HPC infrastructure solutions to businesses and organizations that require substantial computational power. Key revenue streams include data center hosting, where clients rent space and resources in Northern Data's facilities, and specialized HPC services, which involve providing tailored computing solutions for specific industry applications. Additionally, partnerships with technology providers and collaborations with clients across various sectors contribute to its earnings, enabling Northern Data AG to capitalize on the growing demand for advanced computing capabilities.

Northern Data AG Earnings Call Summary

Earnings Call Date:Oct 17, 2024

(Q4-2024)

% Change Since: -44.46%|

Next Earnings Date:Jan 21, 2025

Earnings Call Sentiment Positive

The earnings call highlighted Northern Data's significant growth in cloud revenue and profitability, supported by successful GPU deployments and strong financial positioning. However, challenges in GPU deployment delays and customer diversification were noted. Despite these challenges, the company's strategic initiatives and financial strength indicate a positive outlook.

Q4-2024 Updates

Positive Updates

Record Cloud Revenue Growth

Achieved a record cloud revenue of EUR 121 million, up 722% from 2023, driven by the deployment of Europe's largest pool of GPUs.

Significant Revenue and Profitability Increase

Revenue growth of 159% year-on-year to EUR 200.5 million, with adjusted EBITDA increasing from negative EUR 5.5 million in 2023 to EUR 60 million to EUR 80 million in 2024.

Successful GPU Deployment

Acquired over 22,000 NVIDIA H100 and H200 GPUs, contributing to sequential revenue growth each quarter of 2024.

Strong Financial Position

Well-funded with EUR 120 million in cash and cash equivalents at year-end, supporting further investments and growth.

Operational Improvements in Mining

Increased Bitcoin mining capacity to 7.9 exahash, resulting in 88% year-on-year revenue growth in Peak Mining in Q4.

Expansion in the United States

Expansion plans include new facilities in Georgia and Pittsburgh, Pennsylvania, to support growing HPC demand.

Negative Updates

Challenges in GPU Deployment

Faced delays in finalizing highly complex clusters and component supplies, impacting the speed of GPU ramp-up.

Limited Customer Diversification

Revenue in Q4 concentrated among nine customers, indicating a need for further customer base diversification.

Operating Cash Flow Challenges

Full year operating cash flow was an outflow of EUR 39 million, though positive cash flow is expected for 2025.

Company Guidance

During the Q4 2024 earnings call for Northern Data (NB2.DE), the executives provided comprehensive guidance on the company's financial and strategic performance. They reported a significant revenue increase of 159% year-on-year, reaching EUR 200.5 million, and a remarkable adjusted EBITDA growth from negative EUR 5.5 million in 2023 to a range of EUR 60 million to EUR 80 million in 2024. The cloud revenue was highlighted as a key driver, contributing EUR 121 million for the year, marking a 722% increase from 2023. The company's Bitcoin mining capacity also rose to 7.9 exahash, leading to an 88% year-on-year growth in mining revenue for Q4. Looking forward, Northern Data aims to expand its AI cloud infrastructure, plans to fully deploy its GPUs by the end of Q1 2025, and anticipates positive operating cash flow for the coming year, supported by a robust cash position of EUR 120 million. The executives emphasized their strategic focus on leveraging partnerships, enhancing data center capabilities, and maintaining a strong governance framework to sustain growth and solidify their leadership in the AI market.

Northern Data AG Financial Statement Overview

Summary

Northern Data AG is facing considerable financial challenges with negative profit margins, cash flow deficits, and operational inefficiencies. Despite revenue growth, the company struggles with profitability issues and cash flow constraints, posing risks to long-term sustainability.

Income Statement

Negative

Northern Data AG's income statement shows significant challenges. Gross profit margin is negative due to high costs compared to revenue. Net profit margin is also negative, indicating losses. Despite a notable revenue growth from the previous year, the EBIT and EBITDA margins are negative, pointing to operational inefficiencies and high expense levels.

Balance Sheet

Neutral

The balance sheet reveals a moderately stable financial position with a debt-to-equity ratio of 0.85, suggesting manageable leverage. However, the equity ratio of 50.6% indicates a reliance on liabilities. The ROE is negative, reflecting recent losses. While the company has substantial assets, profitability remains a concern.

Cash Flow

Negative

Cash flow analysis highlights significant issues, with a negative free cash flow indicating insufficient cash generation to cover expenses. Both the operating cash flow to net income and free cash flow to net income ratios are unfavorable, suggesting operational challenges in converting revenues into cash.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
77.53M	200.27M	77.53M	193.29M	189.86M	16.38M
	Gross Profit
-374.00K	-32.69M	-374.00K	64.25M	101.75M	-15.07M
	EBIT
-153.16M	-87.23M	-153.16M	-265.35M	254.13M	-30.48M
	EBITDA
-27.15M	43.06M	-27.15M	-169.49M	388.10M	-65.72M
	Net Income Common Stockholders
-151.06M	-127.44M	-151.06M	-265.77M	287.16M	-84.26M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
242.99M	120.26M	242.99M	39.88M	221.60M	73.86M
	Total Assets
1.04B	1.66B	1.04B	450.59M	798.77M	527.52M
	Total Debt
179.53M	713.66M	179.53M	10.65M	85.94M	42.51M
	Net Debt
-63.47M	593.40M	-63.47M	-29.22M	-135.66M	-31.35M
	Total Liabilities
300.70M	819.46M	300.70M	91.18M	186.50M	350.99M
	Stockholders Equity
734.38M	839.83M	734.38M	359.41M	612.27M	176.52M
Cash Flow		Free Cash Flow
-116.09M	-1.04B	-116.09M	-99.73M	-112.80M	-34.94M
	Operating Cash Flow
-17.60M	-58.39M	-17.60M	960.00K	88.07M	183.48M
	Investing Cash Flow
-84.67M	-950.27M	-84.67M	-95.22M	126.62M	-211.58M
	Financing Cash Flow
305.11M	885.53M	305.11M	-82.91M	-69.03M	99.06M

Northern Data AG Technical Analysis

Technical Analysis Sentiment

Negative

Last Price27.02

Price Trends

50DMA

25.30

Positive

100DMA

31.59

Negative

200DMA

32.96

Negative

Market Momentum

MACD

0.47

Positive

RSI

51.91

Neutral

STOCH

35.86

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:NB2, the sentiment is Negative. The current price of 27.02 is above the 20-day moving average (MA) of 26.71, above the 50-day MA of 25.30, and below the 200-day MA of 32.96, indicating a neutral trend. The MACD of 0.47 indicates Positive momentum. The RSI at 51.91 is Neutral, neither overbought nor oversold. The STOCH value of 35.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:NB2.

Northern Data AG Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GFT	79 Outperform	€623.92M	14.53	16.30%	2.11%	8.63%	-3.90%
BC8	76 Outperform	€4.98B	22.05	12.04%	1.78%	-1.95%	-15.44%
Sector *	62 Neutral	$11.92B	10.48	-7.50%	2.95%	7.40%	-8.18%
NB2	52 Neutral	$1.77B	―		―	―	―
S92	52 Neutral	€687.06M	5.94	-19.00%	2.52%	-19.65%	-152.17%

* Technology Sector Average

Performance Comparison

DE:NB2

Northern Data AG

27.02

4.92

22.26%

DE:BC8

Bechtle Aktiengesellschaft

39.00

-4.67

-10.69%

DE:S92

SMA Solar Technology

19.11

-22.45

-54.02%

DE:GFT

GFT Technologies

22.60

-2.42

-9.67%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.