Market Overview - The US equity market ended Q4 2025 positively, with the S&P 500 increasing by 2.7%, reflecting steady upward momentum supported by better-than-expected corporate earnings and the US Federal Reserve's interest rate easing stance [1] - The macroeconomic backdrop remained resilient, with improving clarity on trade policy providing additional support [1] - There was a notable divergence below the index level, particularly regarding AI investments, which faced skepticism due to bottlenecks and financing challenges [1] Fund Performance - The Alger Small Cap Focus Fund's Class A shares outperformed the Russell 2000 Growth Index in Q4 2025 [1] - The Utilities and Financials sectors contributed positively to the Fund's performance, while the Consumer Discretionary and Information Technology sectors detracted from it [1] Company Spotlight: Nebius Group N.V. - Nebius Group N.V. is a technology company focused on AI-driven cloud infrastructure, with a one-month return of 16.63% and a 52-week gain of 201.69% [2] - As of January 16, 2026, Nebius Group's stock closed at $108.73, with a market capitalization of $27.379 billion [2] - The company operates GPU compute capacity across Europe and is expanding into the U.S., positioning itself as a key player in the AI infrastructure market [3] - Despite facing short-term volatility due to a selloff in AI infrastructure stocks, Nebius continues to secure long-term agreements with major cloud service providers, enhancing revenue visibility [3]

Company Overview - Nebius Group N.V. (NBIS) specializes in building AI datacenters and renting out capacity to large hyperscaler customers [1] - The company currently has an annualized recurring revenue of approximately $584.4 million [1] - Nebius is projecting an increase in annual recurring revenue to between $6 billion and $9 billion [1] Industry Context - The demand for AI datacenters is growing as large hyperscaler customers seek to enhance their capabilities [1] - The company's focus on AI infrastructure positions it well within the expanding technology sector [1]

Core Viewpoint - 2026 is anticipated to be a significant year for certain stocks, particularly Nvidia, Nebius Group, and The Trade Desk, which are expected to show strong performance as fourth-quarter results from 2025 are released [1][2]. Nvidia - Nvidia is the largest company by market cap, driven by its dominant position in graphics processing units (GPUs) for artificial intelligence (AI) computing [3]. - The company has reported being sold out of cloud GPUs, indicating sustained demand for its products [4]. - Nvidia's fiscal fourth quarter 2026 earnings are set to be reported on February 25, with expectations that its fiscal 2027 guidance will exceed current market expectations [6]. Nebius Group - Nebius Group is gaining attention for its services that connect high-end Nvidia GPUs to computing clusters, experiencing significant demand [7]. - The company reported a remarkable 355% year-over-year growth in the third quarter, with an annual run rate (ARR) of $551 million [8]. - Nebius has dramatically increased its 2026 revenue projection, expecting an ARR of $7 billion to $9 billion by the end of 2026, which could lead to rapid stock appreciation if achieved [8][10]. The Trade Desk - The Trade Desk faced challenges in 2025, being one of the worst performers in the S&P 500 due to issues with its AI-powered ad buying platform and lack of political advertising revenue [11]. - In 2026, the company is expected to resolve its platform issues and avoid difficult year-over-year comparisons, potentially leading to a significant stock increase [12]. - Currently trading at less than 18 times forward earnings, The Trade Desk presents a value opportunity compared to the S&P 500 average of 22.4 times [12][14].

Core Insights - The "AI cloud" trade is returning as funds flow back into pure play compute supply-side stocks after a period of volatility since 2026, with CoreWeave up over 40%, Nebius up nearly 30%, and Iren up over 53% [1][5]. Group 1: Market Dynamics - The rebound is driven by improved earnings expectations and upward price movements, with strong signals from the chip sector providing external validation for the "AI cloud" [4]. - Recent performance from TSMC, which exceeded expectations and raised its 2026 capital expenditure forecast, reinforces the view that AI demand is still expanding, alleviating risks associated with the AI cloud service model [4][8]. Group 2: Company Performance - Iren, a vertically integrated digital infrastructure company, is expected to see sales growth of approximately 120% this year and an additional 151% next year, benefiting from rising demand for compute and power from AI and data-intensive workloads [5][7]. - Nebius, positioned as an AI-focused infrastructure and cloud service provider, is projected to experience a staggering 376% sales growth next year due to upward revisions in earnings expectations [7]. - CoreWeave has made significant progress by delivering over 16,000 GPUs by the end of December, recovering from revenue impacts caused by delays in the previous quarter [7][8]. Group 3: Industry Validation - TSMC's record manufacturing yield and capacity expansion provide a solid foundation for new cloud service providers like CoreWeave and Nebius to fulfill their multi-billion dollar backlog orders [8]. - TSMC's gross margin of 62.3% indicates not only industry growth but also high profitability, which helps to alleviate concerns regarding an "AI bubble" [8].

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Core Insights - Retail investors have shown significant interest in five stocks this week, driven by hype around AI and corporate news, including Nebius Group NV, IREN Ltd., D-Wave Quantum Inc., Microsoft Corp., and Oklo Inc. [1] Nebius Group NV (NBIS) - Nebius Group is experiencing bullish momentum due to its plans for early adoption of Nvidia's Vera Rubin platform, with Morgan Stanley initiating coverage and projecting a potential upside of 23.55% [5] - The stock has a 52-week range of $18.31 to $141.10, currently trading around $103 to $105, with a yearly increase of 176.36% and 94.87% over the last six months [6] IREN Ltd. (IREN) - IREN has gained analyst enthusiasm, particularly after a significant Microsoft contract, leading H.C. Wainwright to upgrade the stock to Buy with a price target of $80 [6] - Bernstein has reiterated IREN as a top AI pick for 2026, reflecting optimism in AI demand following CES [6] D-Wave Quantum Inc. (QBTS) - D-Wave Quantum has made a key technical breakthrough in scalable on-chip cryogenic control of qubits, enhancing its roadmap towards error-corrected systems [11] - The stock has a 52-week range of $5.12 to $76.87, trading around $51 to $53, with a yearly return of 353.19% and 199.77% over the last six months [11] Microsoft Corp. (MSFT) - Microsoft is facing a near-term decline amid news of an emergency auction for power contracts, but sentiment remains positive with predictions of reclaiming a $4 trillion valuation [15] - The stock has a 52-week range of $344.79 to $555.45, currently trading around $456 to $458, with a yearly increase of 7.56% but a decline of 9.68% over the last six months [16] Oklo Inc. (OKLO) - Oklo is advancing a nuclear power campus project in partnership with Meta Platforms, with pre-construction expected to start in 2026 and first power by 2030 [16] - The stock has a 52-week range of $4.45 to $46.75, trading around $28 to $30, with a yearly increase of 394.32% and 69.84% over the last six months [12]

Core Insights - Retail investors have shown significant interest in five stocks this week, driven by retail hype, AI developments, and corporate news [1] Group 1: Nebius Group NV (NASDAQ:NBIS) - Nebius Group is experiencing bullish momentum due to its early adoption plans for Nvidia's Vera Rubin platform, expected in the second half of 2026 [5] - Morgan Stanley initiated coverage on Nebius, highlighting aggressive scaling targets and strategic positioning in AI infrastructure, indicating a potential upside of 23.55% [5] - The stock has a 52-week range of $18.31 to $141.10, trading around $103 to $105, with a yearly increase of 176.36% and 94.87% over the last six months [6] Group 2: IREN Ltd. (NASDAQ:IREN) - IREN is benefiting from renewed analyst enthusiasm, particularly due to a significant Microsoft hyperscaler contract [6] - H.C. Wainwright upgraded IREN to Buy with a price target of $80, citing its exposure to AI demand through the Microsoft deal [6] - The stock has a 52-week range of $4.45 to $46.75, trading around $28 to $30, with a yearly increase of 394.32% and 69.84% over the last six months [12] Group 3: D-Wave Quantum Inc. (NYSE:QBTS) - D-Wave Quantum has made a key technical breakthrough in scalable on-chip cryogenic control of gate-model qubits, enhancing its dual-platform roadmap [11] - The stock has a 52-week range of $5.12 to $76.87, trading around $51 to $53, with a yearly return of 353.19% and 199.77% over the last six months [11] Group 4: Microsoft Corp. (NASDAQ:MSFT) - Positive sentiment surrounds Microsoft despite a near-term decline, with predictions of reclaiming a $4 trillion valuation amid rising power costs [15] - The stock has a 52-week range of $344.79 to $555.45, trading around $456 to $458, with a yearly increase of 7.56% but a decline of 9.68% over the last six months [16] Group 5: Oklo Inc. (NYSE:OKLO) - Oklo is advancing a nuclear power campus project in Ohio, supported by a multi-billion-dollar agreement with Meta Platforms [16] - The stock has a 52-week range of $17.42 to $193.84, trading around $91 to $93, with a yearly surge of 277.42% [18]

Group 1 - The core viewpoint of the article highlights a significant increase in the stock prices of companies associated with Nvidia, indicating positive market sentiment towards these stocks [1] - CoreWeave (CRWV.US) experienced a rise of over 8%, while Nebius (NBIS.US) and Arm Holdings (ARM.US) saw increases of more than 2% [1] - Nvidia (NVDA.US) itself also saw a stock price increase of over 2.8%, reflecting strong investor interest [1]

Group 1 - Nvidia-related stocks experienced a significant increase, with CoreWeave (CRWV.US) rising over 8%, NEBIUS (NBIS.US) and Arm Holdings (ARM.US) both increasing by more than 2%, and Nvidia (NVDA.US) itself rising by over 2.8% [1]

Core Viewpoint - Nebius is projected to experience significant growth by 2026, potentially outperforming Nvidia in the AI sector [1][2]. Company Overview - Nebius is not a competitor to Nvidia but a client that utilizes Nvidia's GPUs in its data centers for AI tasks, similar to a cloud computing model [3][4]. - The company has transitioned from its origins in Russia to operating in Europe and the U.S. after being spun out of Yandex due to geopolitical sanctions [4]. Financial Performance - Nebius currently has a market capitalization of $26 billion and an annual run rate of $551 million as of Q3 [6]. - Management anticipates an annual run rate of $7 billion to $9 billion by the end of 2026, indicating substantial growth potential [6][9]. - The stock is currently trading at 65 times sales, but forward sales projections reduce this to 7.1 times for 2026 and 3.2 times for 2027 [7][9]. Growth Strategy - Nebius is focused on aggressive growth and is prioritizing infrastructure development over immediate profitability [11]. - The company has incurred significant debt to finance its expansion plans, which could pose risks if it fails to generate profits in the future [12][14]. - The demand for AI computing infrastructure is expected to continue growing, with Nebius positioned to capture a significant share of this market [9][14].