NBIS is undervalued and attractive near 170 after a drop; Microsoft and Meta contracts plus Nvidia backing underpin AI-cloud demand, with revenue up 454 percent to $582 million and positive EBITDA, but heavy capex and 8.5 billion debt make management execution key risk. Not very bullish, he sees fair value near $200.

The next stock, our second stock, is Nebius, whose ticker symbol is NBIS, and Nebius is a company whose business model you should definitely know about before you look at its share price.

Essentially, Nebius is building a full-fledged AI cloud platform. They provide companies with GPUs, data centers, networking, storage, and the software infrastructure needed to train and manage artificial intelligence.

Yes, I know I'm picking a lot of AI stocks because their prices have fallen a lot this week. This week we saw a big drop in AI company stocks , and so in my opinion these stocks are now undervalued.

I am not a financial advisor. However, what made me interested in Nebius is given below. The world's largest technology companies are investing billions of dollars to leverage their infrastructure.

And obviously, I invested in Nebius when its price was around $90 per share and it went up to over $200. However, given the current state of it and when I do its technical analysis, you will understand how attractive the current discount is compared to its highest price.

Nebius has a huge 5-year deal with Microsoft, worth around $17.4 billion. In addition, they have also developed a great relationship with Meta. So, Microsoft, Meta—all are great.

Meta already had a contract with Nebius worth about $2.9 billion, and then in 2026 they announced another deal worth about $27 billion over 5 years.

And with that, you also have Nvidia. So, Nvidia has invested $2 billion directly in Nebius, so in a way it's like an Nvidia-backed company. And they have entered into a strategic partnership to help expand the company's AI cloud infrastructure.

So to me, this is very important evidence that Nebius will be here for a long time.

And when I saw the stock price drop , you know, how much was it, over 8 percent? We'll discuss the technical aspects, but it's incredible. Absolutely incredible. So, I'm actually really excited.

Microsoft needs AI infrastructure, Meta needs AI infrastructure, and Nvidia understands this market better than anyone else , I would say almost anyone , or literally anyone. And all three companies are willing to invest large sums of money in Nebius.

So, the basic investment concept here is quite simple. The demand for AI continues to grow , hyperscalers require massive amounts of computing capacity, and Nebius is establishing itself as one of the companies providing that capacity.

In the latest quarter, Nebius generated revenue of nearly $582 million, an incredible 454 percent increase over the previous year. Yes, it is truly incredible. Now, we are also seeing Nebius' operating profit increase significantly.

EBITDA came in at around $236 million, compared to an EBITDA loss of $21 million in the same quarter last year. That's exactly what I want to see from a fast-growing company. Now, it's not just income that's increasing.

We are indeed seeing significant operational benefits as Nebius expands.

But, just like with Corvette, there's a but, you know? Building AI infrastructure is incredibly, I mean ridiculously, stupidly expensive. And Nebius spent nearly $5.7 billion on property, equipment, and intangible assets in the second quarter alone.

And their long-term debt reached about 8.5 billion at the end of the quarter. So again , there are some downsides to this , but considering the current market situation, I think the stock is undervalued.

Now, one big difference I like compared to other AI infrastructure companies is that Nebia had about $8 billion in cash. Yes, this is actually a testament to their strong balance sheet and cash equivalent assets at the end of the quarter.

So yes, they are spending a lot of money and taking on a lot of debt, but they are doing it by generating revenue and achieving growth of almost 400%. EBITDA has been positive and they have received literally billions of dollars in long-term commitments from companies like Microsoft and Meta.

And that's why I find Nebia very interesting at this stage.

And whether there is a need for infrastructure here or not is not a big question , because it is quite clear. The real question is, can management build this capability with sufficient skill to convert these huge contracts into sustainable profits and cash flow?

That's why I do n't want to buy NBS at just this price. I'm actually thinking about selling a put option.

Anyway, let me show you what the chart looks like and what my opinion is on NEBIAS at this point. Okay, friends. So, this is the 6-month chart of NEBIAS. While I was recording this video, the share price fell by 7%.

It has dropped below $ 175 per share and I think the stock is quite attractive now. You can see how far the stock has fallen below the Bollinger Bands. So, the Bollinger Band is basically at 183 and the share price is 174.

The level at which the stock is trading now, I think, will create a good opportunity for investors.

To be honest , I'm not very bullish on NEBIAS, but I think it should be worth around $200 per share. So, I don't need to be too bullish to make a good profit , because the stock is already undervalued.

I think there's a lot of volatility here , which makes it very interesting right now because not many stocks are down 7%. At least not very many of the stocks I usually trade. I almost never see a stock fall 7%.

So, when I see a company like NEBIAS go down so much, it seems very, very attractive at around 170.