Nebius Group Surges 4.28% Amid Strong Momentum, but Caution Advised as Overbought Signals Emerge

Technical Analysis

Nebius Group (NBIS) closed at $48.28 on June 6, 2025, marking a robust 4.28% intraday gain with a 52-week range of $14.09 to $50.87. The stock shows strong momentum, trading well above its 50-day ($28.97) and 200-day ($29.12) moving averages, signaling an established uptrend. The Relative Strength Index (RSI) at 76 indicates an overbought condition, suggesting potential near-term profit-taking or consolidation. The MACD reading of 5.75 confirms bullish momentum but hints at caution as the elevated average true range (ATR) of 6.49 signifies increased volatility. Support resides near $46.30, just below the stop-loss threshold of $46.84. No clear resistance level is defined above the recent highs, implying room for further upside but with heightened risk of pullback given the overbought RSI.

For the next trading day (June 9), a modest retracement or sideways movement is probable as the RSI signals overextension. In the coming week, maintaining support in the $46–$47 zone will be critical for sustaining the rally; otherwise, a deeper correction towards the mid-$40s could unfold.

Fundamental Analysis

Nebius Group is positioned as an AI infrastructure player, an emerging sector receiving increasing investor attention. The company recently reported a remarkable 385% year-over-year revenue growth for Q1 and is targeting a $750M to $1.0B revenue run-rate by year-end with positive adjusted EBITDA expected in H2 2025. However, trailing twelve months (TTM) earnings per share stand negative at -$1.94 with a negative price-to-earnings ratio of -24.89, underscoring current unprofitability. The discounted cash flow (DCF) valuation metric of roughly $0.13 per share — substantially lower than the current stock price — indicates the market is pricing in significant future growth and scalability that the firm must actualize. The upcoming earnings announcement on July 28, 2025 will be critical to validate growth projections.

Institutional analysis consensus points toward a "Buy," with price targets clustering near $46, slightly below the current price, suggesting expectations of either a near-term correction or market volatility ahead. Recent company developments include successfully raising $1.0 billion via convertible notes to fuel expansion and highlighted partnerships with Nvidia, enhancing credibility and technological positioning in AI cloud infrastructure.

Intrinsic Value and Long-Term Potential

Despite impressive top-line growth and market enthusiasm, the extremely low DCF-derived intrinsic value signals that the stock is trading on growth expectations rather than current financial fundamentals. The absence of profitability alongside high volatility introduces risk. However, Nebius’s leadership in a high-growth segment of AI infrastructure and recurring revenue model provide a framework for substantial long-term value creation, contingent upon execution and margin improvement.

Strong partnerships and capital raises support the company’s scaling prospects, aligning with a secular AI growth trend likely to persist over the long term. Patience may be warranted until earnings turn sustainably positive and cash flow generation improves, as current metrics reflect an early-stage growth stock with typical volatility and elevated valuation multiples.

Overall Evaluation

NBIS exhibits strong technical momentum but is in overbought territory, indicating caution in the near term. Fundamentals reveal rapid revenue expansion with yet unrealized profitability and a market price well beyond intrinsic value by conventional measures. The stock’s upside depends heavily on operational execution and market sentiment in the evolving AI infrastructure sector.

Categorized as a Hold candidate: the current price reflects optimistic growth expectations balanced against profitability risks and an overstretched technical setup. Investors may await confirmation of sustainable earnings improvement and potential short-term technical consolidation before increasing exposure.