The Dutch league leaders saw off Udinese in the previous round but Verbeek believes Valencia represent a significant step up and one that may be too big for his side.
He told www.uefa.com: "When I first heard the draw I thought, 'The third-best side in Spain is a bit better than the fourth-best in Italy'.
"The further you come, the stronger the opposition. That is the consequence, but that can only be a beautiful thing, of course.
"I don't think we will win the Europa League. Just looking at the budget and the players Valencia have, then they have a 70/30 advantage. In football, though, there is always a chance that the smaller sides can topple the big ones."
One factor in AZ's favour is they are at home first, and they have not lost in their past eight European matches at the AFAS Stadion, winning six and drawing two.
Captain Niklas Moisander said: "Until now it has really worked well for us to play at home first. We are stronger at home, so if we can get a good result in the first match, then anything is possible."
Valencia, UEFA Cup winners in 2004, have never lost to a Dutch side and knocked out PSV Eindhoven in the last round, but defender Hedwiges Maduro is taking nothing for granted, particularly given their domestic form.
Malaga have drawn level with third-placed Los Che in La Liga following a run of only two wins in seven games for Unai Emery's side.
Holland international Maduro told a press conference: "We really want to return to winning ways and this is an important game.
"We are favourites, I think. AZ are a good team and the leaders of the Dutch league, but we still have a good chance of going through.
"AZ are better as a team than PSV Eindhoven. They are better collectively and much more solid. They maintain their shape and that will make finding space more difficult."
Valencia, who are the only one of the eight teams that came into the competition from the Champions League still left in, will be without injured trio Miguel, Ever Banega and Sergio Canales.
Adil Rami is suspended but striker Roberto Soldado returns after a ban, while for the hosts Nick Viergever serves a suspension and Roy Beerens (ribs) is a doubt.