Rothschild Redburn warns of hidden leverage risks in Nebius' capital-intensive AI strategy, setting an $84 price target that significantly trails the current Wall Street consensus.
Rothschild Redburn initiated coverage with a Sell rating and an $84 price target, implying 62% downside, citing high leverage and funding risks for AI infrastructure.
Rothschild & Co Redburn initiated coverage on Nebius (NBIS) with a Sell rating and an $84 price target, representing a 62% downside from recent trading levels. The firm cited significant concerns regarding high leverage and potential funding constraints for the company's ambitious $250 billion AI infrastructure expansion plan.
The firm believes that credit markets are pricing in risks that equity markets are ignoring, specifically regarding high leverage and the massive capital requirements needed for AI infrastructure.
Despite the new Sell rating, the broader consensus remains a Moderate Buy, with an average price target of $232.20 based on multiple analyst ratings.