Applied Digital (NASDAQ:APLD) Shares Gap Up on Analyst Upgrade

Key Points

• Applied Digital shares gapped up after Needham & Company raised its price target to $66 from prior levels and reaffirmed a buy rating. The stock opened above its previous close and was trading higher on heavy volume.
• The company recently announced a $7.5 billion long-term lease with a U.S.-based investment-grade hyperscaler, which significantly boosts revenue visibility and supports its AI data center expansion plans.
• Analyst sentiment remains broadly positive, with multiple firms issuing buy or outperform ratings and the stock carrying an average target price of $46.33. Insider selling was also noted, though institutional ownership remains high at 65.67%.

Applied Digital Corporation (NASDAQ:APLD - Get Free Report)'s share price gapped up before the market opened on Thursday after Needham & Company LLC raised their price target on the stock to $66.00. The stock had previously closed at $39.52, but opened at $42.37. Needham & Company LLC currently has a buy rating on the stock. Applied Digital shares last traded at $45.6330, with a volume of 9,089,938 shares trading hands.

A number of other equities research analysts have also recently commented on APLD. Citigroup reaffirmed an "outperform" rating on shares of Applied Digital in a report on Thursday. Roth Mkm restated a "buy" rating and issued a $65.00 price objective on shares of Applied Digital in a research report on Thursday, April 23rd. Northland Securities set a $56.00 target price on shares of Applied Digital in a report on Wednesday, January 28th. Citizens Jmp reiterated a "market outperform" rating and issued a $40.00 target price on shares of Applied Digital in a research note on Thursday, April 9th. Finally, Zacks Research raised shares of Applied Digital from a "strong sell" rating to a "hold" rating in a report on Thursday, May 7th. Two investment analysts have rated the stock with a Strong Buy rating, eleven have given a Buy rating, one has given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and an average target price of $46.33.

Insider Activity

In other Applied Digital news, Director Richard N. Nottenburg sold 12,500 shares of the company's stock in a transaction that occurred on Thursday, April 30th. The stock was sold at an average price of $34.59, for a total value of $432,375.00. Following the completion of the sale, the director owned 208,378 shares of the company's stock, valued at $7,207,795.02. This represents a 5.66% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. Also, Director Douglas S. Miller sold 10,000 shares of the stock in a transaction that occurred on Monday, April 27th. The shares were sold at an average price of $34.98, for a total transaction of $349,800.00. Following the transaction, the director owned 184,859 shares in the company, valued at $6,466,367.82. The trade was a 5.13% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 35,000 shares of company stock worth $1,182,175 over the last quarter. Corporate insiders own 9.50% of the company's stock.

Key Stories Impacting Applied Digital

Here are the key news stories impacting Applied Digital this week:

• Positive Sentiment: Applied Digital announced a landmark $7.5 billion long-term lease with a U.S.-based investment-grade hyperscaler, a deal that materially improves revenue visibility and strengthens the case for the company’s AI data center expansion. Article Title
• Positive Sentiment: Needham & Company raised its price target on Applied Digital from $51 to $66 and reiterated a buy rating, signaling confidence that the new contract and AI infrastructure demand can support further upside. Article Title
• Positive Sentiment: Market coverage highlighted Applied Digital’s expanding AI hosting and hyperscale footprint versus peers, reinforcing the view that the company is becoming a more important AI infrastructure provider. Article Title
• Neutral Sentiment: After-hours trading commentary and multiple headlines on May 20 suggest the stock was already reacting to the lease announcement, but these items largely repeat the same catalyst rather than add new fundamentals. Article Title

Hedge Funds Weigh In On Applied Digital

Several institutional investors and hedge funds have recently made changes to their positions in the business. Newbridge Financial Services Group Inc. lifted its stake in Applied Digital by 8.6% in the fourth quarter. Newbridge Financial Services Group Inc. now owns 3,800 shares of the company's stock worth $93,000 after purchasing an additional 300 shares during the last quarter. Concurrent Investment Advisors LLC grew its stake in shares of Applied Digital by 1.5% during the fourth quarter. Concurrent Investment Advisors LLC now owns 21,332 shares of the company's stock valued at $523,000 after buying an additional 318 shares during the last quarter. Brookstone Capital Management grew its stake in shares of Applied Digital by 3.6% during the fourth quarter. Brookstone Capital Management now owns 9,275 shares of the company's stock valued at $227,000 after buying an additional 321 shares during the last quarter. ProShare Advisors LLC grew its stake in shares of Applied Digital by 1.0% during the third quarter. ProShare Advisors LLC now owns 36,652 shares of the company's stock valued at $841,000 after buying an additional 376 shares during the last quarter. Finally, Independent Advisor Alliance increased its holdings in shares of Applied Digital by 4.6% in the fourth quarter. Independent Advisor Alliance now owns 9,215 shares of the company's stock worth $226,000 after buying an additional 407 shares during the period. Institutional investors own 65.67% of the company's stock.

Applied Digital Stock Performance

The company has a quick ratio of 2.38, a current ratio of 2.38 and a debt-to-equity ratio of 1.65. The company has a fifty day moving average price of $31.63 and a 200 day moving average price of $30.67. The stock has a market cap of $13.16 billion, a PE ratio of -62.65 and a beta of 5.69.

Applied Digital (NASDAQ:APLD - Get Free Report) last issued its earnings results on Wednesday, April 8th. The company reported ($0.36) earnings per share for the quarter, missing the consensus estimate of ($0.13) by ($0.23). The company had revenue of $108.55 million for the quarter, compared to analysts' expectations of $78.47 million. Applied Digital had a negative net margin of 52.84% and a negative return on equity of 15.91%. The company's revenue was up 139.3% compared to the same quarter last year. During the same quarter in the prior year, the company earned ($0.08) earnings per share. Analysts expect that Applied Digital Corporation will post -0.61 earnings per share for the current year.

Applied Digital Company Profile

Applied Digital NASDAQ: APLD is a technology company specializing in the development and operation of large-scale digital infrastructure and sustainable Bitcoin mining solutions. Through its integrated platform, the company designs, builds and manages turnkey data center facilities while also providing comprehensive hosting services for cloud, colocation and enterprise computing needs. Applied Digital's modular approach to facility design enables rapid deployment of capacity and streamlined integration of power, cooling and network connectivity.

In addition to its data center business, Applied Digital operates a network of Bitcoin mining sites that leverage vertically integrated capabilities, including hardware procurement, mining farm engineering, energy management and real-time performance monitoring.

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