Nebius Group arrives at its July 28 earnings print with a violent week behind it: a 15% single-day drop to $187.77, reversing much of the 19% squeeze rally flagged in Tuesday's note, while the underlying short positioning remains structurally unchanged.
The most important update since the July 22 article is what has — and hasn't — moved. Short interest sits at 28.7% of the free float, essentially flat on the week (+1.9%) and still carrying the full weight of the aggressive 38%-in-a-month build documented across recent coverage. What has shifted is availability. After tightening to near-zero across most of July (4.7% as recently as July 21), availability has reopened sharply to 45%, up 23% on the week. That reopening is consistent with the price drop: as longs sold and the stock fell 15%, borrowed shares were returned to the pool before being quickly re-lent. The borrow cost has ticked up 35% on the week to 1.15% — still modest in absolute terms, but moving in the right direction for new shorts entering on the weakness. The ORTEX short score has edged fractionally lower to 70.8, still firmly elevated and in line with the 71-range it has held all month.
Options positioning has swung back toward caution after Tuesday's brief relief. The put/call ratio has climbed to 1.21, above its 20-day average of 1.16 — not extreme, but directionally consistent with investors rebuilding downside protection after the rally faded. The 52-week high on the PCR is 1.29, so the current reading is in the upper range of recent history without quite touching maximum defensiveness. That dynamic mirrors the broader setup: neither fully panic-driven nor complacent.
The analyst community is leaning constructively into the print. Baird initiated coverage at Outperform with a $250 target on July 22. Northland Capital Markets raised its target to $410 from $248 on July 20, a notable 65% lift. The consensus sits at 10 buy ratings versus 1 sell, with a mean price target of $258 — roughly 37% above the current price. Morgan Stanley remains the outlier, maintaining Equal-Weight with a $144 target. Bulls focus on the $17 billion Microsoft revenue agreement, vertical integration across compute stack, and the company's demonstrated capacity-expansion execution. Bears flag the premium valuation on a still-unprofitable business — the EV/EBITDA multiple has compressed 10% over 30 days but the P/E is deeply negative — alongside risks from hyperscaler competition and evolving compute preferences. The EPS surprise factor score of just 4 out of 100 is a concrete caution flag: Nebius has not been a consistent earnings beat story.
The earnings history adds one more variable. The last two prints produced a +23% move and a -8% move on the day respectively. With 28.7% of the float still short, availability back open enough to allow fresh positioning, and the stock having whipsawed 34 points in three sessions, the July 28 release is a direct test of whether the bear thesis — that valuation has run too far ahead of a loss-making business — can survive contact with whatever revenue and capacity figures Nebius reports.
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