Nebius Stock: Price, AI Hype, and Nvidia Comparisons

Alright, let's dissect Cramer's take on Nebius. During the "Mad Money" lightning round, he waved off Nebius as "too speculative," suggesting Dell as a safer bet. Fair enough. But is it accurate? Let's run some numbers.

Nebius: Speculative, Sure. But What's the Potential Upside?

Cramer's aversion to "losing money" is understandable. Nobody wants to back a money pit. But the AI space isn't known for immediate profitability. It’s about future dominance. The question is: Does Nebius have a plausible path to that dominance, or is it just another flash in the pan?

Nebius operates in a crowded field. AI compute is dominated by the usual suspects: Amazon, Microsoft, and, increasingly, Nvidia via its cloud services. Coreweave is nipping at their heels. Nebius is trying to carve out a niche, but details on their specific strategy remain surprisingly vague. Their association with Iren (a company focused on high-performance computing infrastructure) suggests they're aiming for specialized AI workloads.

The real question is, how is Nebius differentiating itself? Price? Specialization? Location? The lack of clear answers is concerning (and this is the part of the report that I find genuinely puzzling). I've looked at hundreds of these filings, and the absence of a clear competitive advantage is a red flag.

Let's talk about "speculative." Nebius is pre-revenue, or close to it. That means valuation is based almost entirely on projections and market sentiment. And sentiment, as we all know, can be fickle. But "speculative" doesn't automatically equal "bad." It means the risk is higher, but so is the potential reward. Think of Tesla a decade ago – wildly speculative, but look at it now. (Of course, for every Tesla, there are a dozen companies that went bust.)

Dell: Safe, Yes. But Where's the Growth?

Now, about Dell. Cramer pitches it as the "sensible" alternative. Dell is a stable, profitable company with a long track record. But "stable" often translates to "slow growth." Dell's growth over the past five years has been… let's call it "modest." About 5% annually. To be more exact, 4.8%.

Dell is betting big on AI-capable PCs and servers. They're trying to ride the AI wave without being a pure-play AI company. This is a classic "picks and shovels" strategy – providing the infrastructure for the gold rush, rather than digging for gold yourself. It's less risky, but the returns are also likely to be lower.

Here's the rub: Dell's success in AI depends on other companies (like Nebius) succeeding. If the AI revolution fizzles, Dell will be fine, but its AI-related growth will stall. If Nebius does manage to carve out a significant market share, Dell could miss out on the biggest gains.

And this is where the potential missed opportunity lies. Cramer is advocating for safety and stability. Which is fine, if you're risk-averse. But if you're looking for explosive growth, Dell isn't the answer. It's like choosing a savings account over a lottery ticket. One is guaranteed to give you a small return; the other might make you rich, but probably won't.

Playing It Too Safe?

Cramer's call on Nebius feels like a classic case of favoring the known over the unknown. There's nothing inherently wrong with that, but it's important to understand the trade-offs. Nebius is a gamble. But sometimes, the biggest rewards come from taking calculated risks. Whether that gamble is worth it depends entirely on your risk tolerance and your belief in Nebius's long-term potential.