Applied Digital (NASDAQ:APLD) Trading 6.6% Higher - What's Next?

Key Points

• Applied Digital shares rose 6.6% on Thursday, reaching as high as $42.07, as investors reacted to a strong run of positive news around the company.
• The biggest catalyst was a $1.59 billion secured notes deal to fund construction of its Polaris Forge 1 AI data center, with the debt priced at a lower-than-expected 7% yield and paired with a major long-term AI campus lease.
• Analyst sentiment remains mixed but broadly upbeat: several firms raised price targets, though Zacks downgraded the stock to strong sell, and the consensus view is still Moderate Buy with an average target price of $67.67.

Applied Digital Corporation (NASDAQ:APLD - Get Free Report) shot up 6.6% on Thursday . The company traded as high as $42.07 and last traded at $41.47. 16,877,587 shares traded hands during mid-day trading, a decline of 34% from the average session volume of 25,720,973 shares. The stock had previously closed at $38.92.

Trending Headlines about Applied Digital

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

• Positive Sentiment: Applied Digital closed a $1.59 billion secured notes deal to fund construction of its Polaris Forge 1 AI data center, and the lower-than-expected 7% yield suggests strong investor appetite for its growth story. Applied Digital Taps US$1.59b Notes To Power AI Data Center Growth
• Positive Sentiment: The company also priced the debt below prior expectations, which may ease financing concerns and support further AI campus expansion. Applied Digital Prices $1.59 Billion AI Debt Deal at 7%
• Positive Sentiment: Applied Digital secured a major long-term AI campus lease with a hyperscaler, reinforcing visibility into future utilization and revenue. Applied Digital Secures Major Long-Term AI Campus Lease
• Neutral Sentiment: Shares were also boosted by analyst commentary and bullish media coverage pointing to upside if the company keeps converting leased capacity into revenue. Applied Digital Corp (APLD)’s Blue-Chip Customer Returns for More
• Negative Sentiment: Zacks Research downgraded Applied Digital from hold to strong sell, which could temper enthusiasm around the recent run-up. Zacks downgrade

Wall Street Analysts Forecast Growth

Several equities research analysts have recently issued reports on APLD shares. Weiss Ratings reaffirmed a "sell (d-)" rating on shares of Applied Digital in a research report on Friday, April 24th. Citigroup restated a "market outperform" rating on shares of Applied Digital in a research report on Tuesday. Needham & Company LLC raised their price objective on shares of Applied Digital from $66.00 to $83.00 and gave the stock a "buy" rating in a report on Tuesday. Craig Hallum lifted their price objective on shares of Applied Digital from $75.00 to $79.00 and gave the stock a "buy" rating in a research report on Tuesday. Finally, Lucid Cap Mkts upgraded shares of Applied Digital to a "strong-buy" rating in a research note on Wednesday, May 27th. Three investment analysts have rated the stock with a Strong Buy rating, eleven have issued a Buy rating and two have assigned a Sell rating to the company. According to data from MarketBeat.com, Applied Digital presently has a consensus rating of "Moderate Buy" and an average target price of $67.67.

Applied Digital Stock Up 6.6%

The company has a debt-to-equity ratio of 1.65, a current ratio of 2.38 and a quick ratio of 2.38. The stock has a market capitalization of $11.85 billion, a P/E ratio of -56.04 and a beta of 5.69. The stock has a fifty day moving average price of $37.22 and a 200 day moving average price of $32.50.

Applied Digital (NASDAQ:APLD - Get Free Report) last issued its quarterly earnings data on Wednesday, April 8th. The company reported ($0.36) EPS for the quarter, missing the consensus estimate of ($0.13) by ($0.23). Applied Digital had a negative net margin of 52.84% and a negative return on equity of 15.91%. The firm had revenue of $108.55 million for the quarter, compared to analysts' expectations of $78.47 million. During the same period in the prior year, the firm posted ($0.08) EPS. Applied Digital's revenue was up 139.3% on a year-over-year basis. On average, research analysts forecast that Applied Digital Corporation will post -0.68 earnings per share for the current year.

Insider Activity at Applied Digital

In related news, Director Douglas S. Miller sold 10,000 shares of the firm's stock in a transaction that occurred on Monday, April 27th. The shares were sold at an average price of $34.98, for a total value of $349,800.00. Following the sale, the director directly owned 184,859 shares of the company's stock, valued at $6,466,367.82. This trade represents a 5.13% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, Director Richard N. Nottenburg sold 12,500 shares of Applied Digital stock in a transaction that occurred on Thursday, April 30th. The shares were sold at an average price of $34.59, for a total transaction of $432,375.00. Following the sale, the director owned 208,378 shares of the company's stock, valued at approximately $7,207,795.02. The trade was a 5.66% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last 90 days, insiders sold 35,000 shares of company stock worth $1,182,175. 9.50% of the stock is owned by company insiders.

Institutional Investors Weigh In On Applied Digital

Large investors have recently added to or reduced their stakes in the company. AQR Capital Management LLC boosted its holdings in shares of Applied Digital by 84.8% in the 1st quarter. AQR Capital Management LLC now owns 18,945 shares of the company's stock worth $106,000 after purchasing an additional 8,692 shares in the last quarter. NewEdge Advisors LLC lifted its position in Applied Digital by 239.1% in the 1st quarter. NewEdge Advisors LLC now owns 33,267 shares of the company's stock worth $187,000 after buying an additional 23,457 shares during the last quarter. Geneos Wealth Management Inc. boosted its stake in Applied Digital by 113.3% in the first quarter. Geneos Wealth Management Inc. now owns 6,667 shares of the company's stock worth $37,000 after buying an additional 3,542 shares in the last quarter. Strs Ohio purchased a new stake in Applied Digital in the first quarter worth approximately $71,000. Finally, Cetera Investment Advisers grew its position in Applied Digital by 61.0% during the second quarter. Cetera Investment Advisers now owns 61,656 shares of the company's stock valued at $621,000 after acquiring an additional 23,360 shares during the last quarter. Hedge funds and other institutional investors own 65.67% of the company's stock.

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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