The analyst declined to advise buying Nebius shares. They have gone up 5 times in a year

Investment company D.A. Davidson downgraded the shares of cloud capacity provider Nebius Group, founded by Kazakh native Arkady Volozh, and no longer recommends buying them. Nebius shares lost about 12% of their value after that.

D.A. Davidson changed its rating on shares of Nebius from Buy to Neutral, MarketBeat reports. At the same time, the bank maintained its target price of $250, which it raised to that level - and at once by a quarter - just a week ago. That's about 14% above the closing price on Friday, Ma. 15 (the latest by the time of the D.A. Davidson note).

Nebius shares are up 418% over the past year (already including Monday's collapse) and have added 133% since the start of January. The company "deserves a high valuation," but the securities probably need a pause after strong growth, said Gil Luria, managing director and head of technology analytics at D.A. Davidson, whose note is quoted by Seeking Alpha.

"Nebius shares have significantly outperformed the market since we began our analyst coverage of them just over a year ago. From a company that had been off investors' radar, Nebius has quite deservedly emerged as one of the key AI trading assets. We believe the stock deserves the current high valuation, but believe it is one that could limit upside in the short term," the analyst said.

Nebius shares were down 12.3% to $192.8 in after-hours trading on Monday, May 18.

According to MarketWatch, the majority of analysts tracking Nebius shares advise buying them: the securities have 11 such recommendations out of 16 total. Another four think the securities should be held, one thinks they should be sold. The Wall Street consensus target price is $240, up 9% from the closing price on Ma 15.

This article was AI-translated and verified by a human editor