Key Takeaways
- DA Davidson slashed NBIS price target by 30%, from $250 down to $175, while keeping a Neutral stance
- Construction setbacks at the Vineland, New Jersey facility may prevent 2026 completion targets
- Gil Luria, the firm’s analyst, cautions that delays threaten Nebius’ position as leading neocloud provider
- Second quarter results drop August 12; consensus calls for $569.89M revenue, up 442% from prior year
- Shares have surged 120% in 2026 but currently sit at $191.53, above the revised price target
Nebius Group has enjoyed an impressive rally throughout 2026, climbing 120% since January and posting 173% gains over a twelve-month period. However, a new analyst downgrade is now testing investor confidence.
Gil Luria from DA Davidson reduced his NBIS price objective from $250 to $175 this Monday, just days before the company releases its second quarter 2026 financial results on August 12. Trading at $191.53, the stock now sits above the analyst’s revised target.
While maintaining his Neutral stance, Luria raised red flags regarding construction momentum at Nebius’ New Jersey data center in Vineland.
The investment firm conducted an on-site inspection and participated in a local city council meeting to evaluate progress directly. Following this investigation, Luria concluded the location is unlikely to achieve its planned 328 MW of operational power capacity before year-end.
This development carries significant weight because Nebius must expand its connected power infrastructure from approximately 170 MW recorded at 2025’s close to a range of 800 to 1,000 MW by December 2026.
Simultaneously, management aims to boost its revenue run rate from $1.9 billion as of March 2026 to between $7 billion and $9 billion by year-end. Such aggressive expansion within such a compressed timeframe presents substantial challenges.
Construction Setbacks Threaten 2026 Projections
According to Luria, the Vineland construction delays could eliminate potential upside from the company’s 2026 forecasts. More concerning, he suggested these issues might undermine the entire investment thesis surrounding Nebius.
“We fear that the narrative on Nebius could change and the ability to convert contracted power to connected power and then into active power (revenue) may be put into question,” Luria wrote.
The company currently commands a 21% valuation premium over competitor CoreWeave (CRWV) based on backlog metrics, plus a substantial 172% premium relative to Oracle’s artificial intelligence cloud offerings. Maintaining these premiums requires flawless operational delivery.
Despite these concerns, Luria recognized Nebius’ established credibility, supported by seasoned leadership, aggressive contracted gigawatt capacity expansion, and superior capital positioning versus competitors. The firm’s ownership interest in Clickhouse also represents a valuable supplementary holding, according to the analyst.
Q2 Financial Results Preview
Consensus estimates anticipate a wider per-share loss of $0.72 for the second quarter of 2026, expanding from the $0.38 loss reported in the comparable 2025 period.
Analysts project revenue reaching $569.89 million, marking spectacular 442% year-over-year expansion. Surging demand for AI-powered cloud infrastructure services underpins these optimistic projections.
Options market activity suggests potential volatility around 13% when earnings hit on August 12.
Piper Sandler maintains a Neutral position on NBIS shares with a $224 price objective. Baird rates the stock Outperform with a $250 target, emphasizing Nebius’ competitive advantages in AI inference workloads. According to InvestingPro analysis, current trading levels appear modestly elevated compared to Fair Value calculations.
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