Key Points
Nebius (NASDAQ: NBIS) is one of the fastest-growing AI stocks, yet it flies under the radar of most investors. Nebius’s growth rates are something you have to see to believe, but one thing’s for sure: Its rapid growth will push the stock higher over the next year.
I think a $1,000 investment in Nebius will be worth a fair bit more by the end of next year, so if you’ve got some cash ready to deploy, Nebius may be one of the best stocks to buy.
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Nebius is growing at warp speed
The biggest factor in a company’s success in the AI race right now is how much computing capacity it has access to. That’s a major part of what’s driving success, and companies are racing to stand up as much computing capacity as possible.
One way they’re doing that is by renting computing capacity from neocloud providers that offer AI-focused cloud computing platforms. Nebius is one of the biggest companies in this space and growing at an unreal pace due to massive demand.
Nebius is backed by Nvidia, which is a major endorsement in this sector. It’s also a Nebius investor, and it’s easy to see why.
During the second quarter, Nebius grew its revenue at an incredible 454% pace. A one-time effect or acquisition didn’t skew that; it’s real revenue growth driven by strong demand for its platform. However, it’s not done there.
For Q3 and Q4 2026, Wall Street analysts expect growth of 521% and 535%, respectively. For 2027, they expect 261% growth. That makes it one of the fastest-growing companies on the market, but there is one caveat: earnings.
Nebius is spending every penny it can to build and acquire data centers to capture market share while demand is high. This is the smart move for Nebius, but it does place it in a bit of a precarious investment spot. There’s no guarantee that Nebius will ever break even, even if it does decide to focus on profitability. That makes it a higher-risk investment, but if it pays off, it could be a high reward.
So, what will a $1,000 investment in Nebius be worth by 2027?
Nebius could be a great pick
Fortunately, there are targets for Nebius to hit that other cloud computing providers have already established. Alphabet‘s Google Cloud had a 35.6% operating margin in Q2, and I think projecting Nebius to have a long-term operating margin of 30% is a wise move for investors. While Nebius won’t achieve this for a long time, as it builds out its operations and acquires businesses as they become available, I think it’s smart to use this figure as a long-term model for where it could go. That way, Nebius’s valuation doesn’t get out of hand.
Next year, Wall Street analysts project average revenue of $12.1 billion. If Nebius were profitable and produced a 30% operating margin, it would generate $3.63 billion in operating income. If we value the stock at 30 times operating income, that would give Nebius a valuation of $109 billion. Remember, these are all hypothetical figures, but it helps investors understand where Nebius could be going over the next few years if it could become a fully profitable business.
Right now, Nebius has a market cap of $61 billion. That means Nebius stock has around a 79% upside, turning a $1,000 investment into $1,790.That’s a solid gain in one year, and I think it makes Nebius a great stock to buy.
While I don’t think Nebius will be profitable next year, using estimated figures for what a fully profitable Nebius could look like helps investors decide whether a stock is a good buy.
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Keithen Drury has positions in Alphabet, Nebius Group, and Nvidia. The Motley Fool has positions in and recommends Alphabet and Nvidia. The Motley Fool has a disclosure policy.
