Nebius Group N.V. (NBIS)

Conclusion

Nebius Group N.V. builds full-stack infrastructure for the AI industry, including GPU clusters and cloud platforms. It also runs the TripleTen edtech platform and the Avride autonomous driving unit. At 141.45 USD on 2026-11-09, the company has a market capitalisation of 33.7 billion USD and an enterprise value of 35.7 billion USD.

The verdict is overvalued. The price-to-earnings ratio of 547.4 compares with a historical median of 64.5, and enterprise value to EBITDA of 38.4 compares with 24.0. The fair value band runs from 51.67 to 77.50 USD, with a midpoint of 64.58 USD, giving a margin of safety of -54.3% at the current price. The discounted cash flow gives no usable per-share value because free cash flow is negative, and the growth implied by the price is not available. Revenue grew at a compound rate of 239.8% over three years but fell 29.1% a year over five.

The strongest numbers are the current ratio of 4.03, the quick ratio of 3.49 and a Piotroski score of 7 out of 8. The share count has fallen at a compound 6.4% a year over five years. The weakest are interest coverage of 0.70x, ROIC of 1.06% against a WACC of 10.69%, and a trailing operating margin of -49.3%. Trailing free cash flow conversion stands at -95.5.

Financial health

Red: the current ratio (4.03) and quick ratio (3.49) hold the picture up, while interest coverage of 0.70x and an Altman Z-score of 1.71 pull it down. Net debt to EBITDA is 2.17x and debt to equity is 0.97. The Altman Z-score of 1.71 sits in the distress zone, but that model was designed for manufacturers and Nebius is not one in the usual sense. Insolvency risk is low, about 0.56% by the estimate of the Ohlson model over one to two years. Interest coverage is the figure to watch, since operating earnings currently do not cover interest expense.

Earnings quality

Yellow: the Piotroski score of 7 out of 8 and the falling share count are positive, while free cash flow conversion is weak. Trailing conversion is -95.5 and the five-year figure is -13.1. The accrual ratio is -3.5%. Stock-based compensation is 17.0% of revenue, and free cash flow after it is -6.11 billion USD. The Beneish M-score reading is not available. The company beat estimates in 6 of the last 8 quarters, with an average surprise of 66.2%. However, next-year EPS growth is estimated at -71.4%, and recent revisions are split evenly between upward and downward.

Profitability

Red: the operating margin of -49.3% is far below its historical median of 1.7%. The gross margin of 58.6% compares with a median of 64.5%, and the net margin of 4.6% with a median of 10.6%. ROIC of 1.06% sits against a WACC of 10.69%, giving a ROIC minus WACC of -9.63%, which means the company destroys value. The five-year median ROIC is -2.55%. Return on equity is only 0.6%, so leverage is not inflating it. The 2025 DuPont split shows a net margin of 19.2%, an asset turnover of 0.04 and an equity multiplier of 2.70.

Growth

Red: revenue compounded at 239.8% over three years, but at -29.1% over five and -4.4% over ten. Revenue grew in 9 of the 10 comparable years. EPS fell at a compound 39.4% over three years, 15.7% over five and 0.3% over ten. The estimate for next-year EPS growth is -71.4%. The three-year revenue rate reflects a very recent rise after a long decline, so it should not be read as a steady trend.

Valuation

Red: the price-to-earnings ratio of 547.4 is a 748.5% premium to its historical median of 64.5. Enterprise value to EBITDA of 38.4 is a 60.4% premium to 24.0. Price to sales of 24.9 is a 220.5% premium to 7.8, and price to book of 3.26 is a 37.9% discount to 5.25. The DCF uses a discount rate of 12.59% and a terminal growth rate of 2.5%, but the base free cash flow is negative, so no per-share DCF value is available. The reverse DCF implied growth is not available. The fair value band of 51.67 to 77.50 USD rests on fixed assumptions, such as a 5% equity risk premium and capped growth. It is not a price target. The fair value from historical multiples is 64.58 USD. The company pays no dividend.

Risks

Interest coverage of 0.70x means operating earnings do not cover interest expense, so any further fall in profit would strain debt service. Negative free cash flow, even after the falling share count, means growth has to be funded externally. ROIC below WACC means new capital is not yet earning its cost. Estimate cuts for next year would reinforce these pressures. Several values are not available: the per-share DCF, the reverse DCF implied growth, the Beneish reading, the debt maturity schedule and revenue by segment. Without a debt maturity schedule, the refinancing risk cannot be assessed, and without segment revenue, the contribution of the AI infrastructure business cannot be separated from the edtech and autonomous driving units.