Applied Digital (NASDAQ:APLD) Shares Gap Up - Still a Buy?

Key Points

• Shares gapped up to open at $33.70 (previous close $32.19) on heavy volume, and analysts hold a consensus Moderate Buy rating with an average target price of $42.78 and multiple $40+ price objectives.
• Applied Digital reported revenue of $108.6M (up 139% YoY) but missed EPS at ($0.36) versus ($0.13) expected, leaving the company with a negative net margin (~52.8%) and analyst estimates of about -0.52 EPS for the year.
• Insider Director Chuck Hastings sold ~45,987 shares while institutional ownership is high (~65.7%), with Vanguard and several funds substantially increasing their stakes recently.

Applied Digital Corporation (NASDAQ:APLD - Get Free Report) shares gapped up prior to trading on Tuesday . The stock had previously closed at $32.19, but opened at $33.70. Applied Digital shares last traded at $32.1970, with a volume of 6,318,865 shares traded.

Analyst Upgrades and Downgrades

A number of brokerages have recently issued reports on APLD. Northland Securities set a $56.00 price objective on shares of Applied Digital in a research note on Wednesday, January 28th. Citizens Jmp reissued a "market outperform" rating and issued a $40.00 price objective on shares of Applied Digital in a research note on Thursday, April 9th. Needham & Company LLC reaffirmed a "buy" rating and set a $41.00 target price on shares of Applied Digital in a research note on Thursday, January 8th. Roth Mkm reaffirmed a "buy" rating on shares of Applied Digital in a research note on Tuesday, February 17th. Finally, Arete Research assumed coverage on shares of Applied Digital in a research note on Wednesday, January 7th. They set a "buy" rating for the company. Two equities research analysts have rated the stock with a Strong Buy rating, eleven have assigned a Buy rating and two have issued a Sell rating to the company. According to data from MarketBeat, Applied Digital has a consensus rating of "Moderate Buy" and an average target price of $42.78.

Applied Digital Stock Up 0.8%

The business's fifty day moving average is $28.48 and its two-hundred day moving average is $29.83. The company has a market cap of $9.27 billion, a P/E ratio of -43.93 and a beta of 7.25. The company has a debt-to-equity ratio of 1.65, a quick ratio of 2.38 and a current ratio of 2.38.

Applied Digital (NASDAQ:APLD - Get Free Report) last posted its quarterly earnings results on Wednesday, April 8th. The company reported ($0.36) EPS for the quarter, missing the consensus estimate of ($0.13) by ($0.23). The business had revenue of $108.55 million during the quarter, compared to the consensus estimate 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 for the quarter was up 139.3% compared to the same quarter last year. During the same quarter in the prior year, the firm posted ($0.08) EPS. Equities analysts predict that Applied Digital Corporation will post -0.52 EPS for the current year.

Insiders Place Their Bets

In other Applied Digital news, Director Chuck Hastings sold 45,987 shares of the business's stock in a transaction that occurred on Thursday, January 29th. The shares were sold at an average price of $38.57, for a total transaction of $1,773,718.59. Following the sale, the director owned 388,372 shares of the company's stock, valued at approximately $14,979,508.04. The trade was a 10.59% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Corporate insiders own 9.50% of the company's stock.

Institutional Trading of Applied Digital

Several large investors have recently made changes to their positions in APLD. Vanguard Group Inc. boosted its holdings in Applied Digital by 36.4% during the fourth quarter. Vanguard Group Inc. now owns 24,168,082 shares of the company's stock worth $592,601,000 after buying an additional 6,445,908 shares in the last quarter. Value Aligned Research Advisors LLC purchased a new stake in Applied Digital during the fourth quarter worth $138,380,000. Situational Awareness LP boosted its holdings in Applied Digital by 87.0% during the fourth quarter. Situational Awareness LP now owns 11,339,060 shares of the company's stock worth $278,034,000 after buying an additional 5,274,905 shares in the last quarter. BNP Paribas Financial Markets boosted its holdings in Applied Digital by 24,356.8% during the second quarter. BNP Paribas Financial Markets now owns 5,219,565 shares of the company's stock worth $52,561,000 after buying an additional 5,198,223 shares in the last quarter. Finally, Marex Group plc boosted its holdings in Applied Digital by 38,484.6% during the fourth quarter. Marex Group plc now owns 3,904,759 shares of the company's stock worth $95,745,000 after buying an additional 3,894,639 shares in the last quarter. 65.67% of the stock is owned by hedge funds and other institutional investors.

About Applied Digital

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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