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On Monday, DA Davidson lifted the price target for Nebius Group (NASDAQ:NBIS) shares from $30.00 to $35.00 while reiterating a Buy rating on the stock. The adjustment comes in response to news that ClickHouse, a company in which Nebius Group has a significant stake, is seeking a new funding round at a valuation of $6 billion. Khosla Ventures is expected to lead this funding round. The new target aligns with broader analyst sentiment, as InvestingPro data shows analyst targets ranging from $30 to $60, with the stock currently trading at $28.27. The stock has shown strong momentum, gaining nearly 19% in the past week alone.
The analyst at DA Davidson noted that the valuation increase for ClickHouse, a company Nebius Group originally founded and spun off in 2021, significantly enhances Nebius’ sum-of-the-parts valuation. With a 28% stake in ClickHouse, Nebius’ interest in the company is now estimated to have risen from $560 million to $1.68 billion before dilution. This substantial increase has contributed to the revised price target for Nebius Group shares. According to InvestingPro analysis, Nebius Group currently maintains a market capitalization of $6.66 billion, with strong financial health indicators including a current ratio of 9.6x and minimal debt-to-equity of 0.02.
The report from The Information detailing ClickHouse’s funding ambitions underscores the potential financial impact on Nebius Group’s holdings. The analyst’s commentary emphasizes the relevance of this development to Nebius’ overall valuation, suggesting that the $5 per share increment from ClickHouse, coupled with a higher comparative valuation to CRWV, justifies the new price target.
Nebius Group’s strategic investment in ClickHouse appears to be paying off, as the anticipated funding round suggests robust growth and a promising future for the database management system provider. The increase in valuation for ClickHouse directly benefits Nebius Group, contributing to the positive outlook reflected in DA Davidson’s updated assessment.
Investors will be watching closely as ClickHouse progresses with its funding round and Nebius Group potentially reaps the benefits of its stake in the company. The raised price target is indicative of the analyst’s confidence in Nebius Group’s investment strategy and its ability to generate value from its associated enterprises. For deeper insights into Nebius Group’s valuation and growth prospects, InvestingPro subscribers can access comprehensive analysis, including 12 additional ProTips and detailed financial metrics in the Pro Research Report, which transforms complex Wall Street data into actionable intelligence.
In other recent news, Nebius Group has been making significant strides in its operations and market positioning. The company has announced plans to enhance its cloud computing capabilities in the United States with a new data center in New Jersey, designed to support up to 300 megawatts of capacity. This expansion is part of a broader strategy that includes additional capacity at its Kansas City location and a new site in Iceland. In a notable development, Nebius will also be among the first to offer the NVIDIA (NASDAQ:NVDA) Blackwell Ultra AI platform, providing advanced computing power to AI developers and enterprises by the end of 2025. Northland has initiated coverage of Nebius Group with an Outperform rating and a $34 price target, citing the company’s strategic positioning and financial planning. Meanwhile, DA Davidson has maintained a Buy rating with a $50 price target, highlighting Nebius Group’s diversified revenue stream and potential resilience against market fluctuations. In another strategic move, Bezos Expeditions led a $72 million investment round for Toloka, an AI firm under Nebius Group, aiming to expand its operations in the U.S. market. This investment will allow Toloka to gain operational independence while maintaining a significant economic interest from Nebius. These developments indicate Nebius Group’s aggressive growth strategy and commitment to expanding its presence in the AI infrastructure market.
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