Applied Digital (NASDAQ:APLD) Reaches New 1-Year Low Following Analyst Downgrade

Key Points

• Applied Digital shares fell to a new 52-week low of $17.02 after B. Riley cut its price target from $75 to $51, though it maintained a buy rating.
• Analyst sentiment remains broadly positive, with a consensus “Moderate Buy” rating and an average target price of $57.75; however, some firms maintain sell or equal-weight ratings.
• The company reported stronger-than-expected quarterly results, including $300.39 million in revenue—up 367.8% year over year—and an EPS loss of $0.01 versus the $0.30 expected loss. CEO Wes Cummins also purchased approximately $1.0 million in shares.

Applied Digital Corporation (NASDAQ:APLD - Get Free Report) shares reached a new 52-week low on Monday after B. Riley Financial lowered their price target on the stock from $75.00 to $51.00. B. Riley Financial currently has a buy rating on the stock. Applied Digital traded as low as $17.02 and last traded at $17.4520, with a volume of 2,117,797 shares traded. The stock had previously closed at $17.82.

Several other analysts also recently issued reports on the company. UBS Group reissued a "buy" rating on shares of Applied Digital in a report on Thursday, October 8th. Wall Street Zen lowered Applied Digital from a "sell" rating to a "strong sell" rating in a research report on Sunday, August 30th. Morgan Stanley set a $41.00 target price on Applied Digital and gave the company an "equal weight" rating in a research note on Friday, October 9th. Wells Fargo & Company reissued an "overweight" rating and set a $55.00 price target (up from $50.00) on shares of Applied Digital in a report on Thursday, October 8th. Finally, Weiss Ratings restated a "sell (d-)" rating on shares of Applied Digital in a research report on Monday, October 19th. Three investment analysts have rated the stock with a Strong Buy rating, twelve have assigned a Buy rating, two have issued a Hold rating and two have given a Sell rating to the company. Based on data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $57.75.

Insider Buying and Selling at Applied Digital

In other news, Director Richard Nottenburg sold 75,000 shares of the stock in a transaction that occurred on Tuesday, August 4th. The shares were sold at an average price of $31.15, for a total value of $2,336,250.00. Following the completion of the transaction, the director directly owned 133,378 shares in the company, valued at $4,154,724.70. This trade represents a 35.99% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CEO Wes Cummins purchased 55,803 shares of the stock in a transaction dated Friday, October 16th. The shares were purchased at an average price of $18.04 per share, for a total transaction of $1,006,686.12. Following the completion of the transaction, the chief executive officer owned 5,874,453 shares in the company, valued at $105,975,132.12. This trade represents a 0.96% increase in their position. The SEC filing for this purchase provides additional information. 9.50% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Applied Digital

Several hedge funds and other institutional investors have recently bought and sold shares of APLD. Covestor Ltd raised its holdings in Applied Digital by 8,660.4% during the 3rd quarter. Covestor Ltd now owns 18,134 shares of the company's stock worth $442,000 after buying an additional 17,927 shares during the period. Integrity Alliance LLC. acquired a new stake in shares of Applied Digital during the third quarter valued at approximately $252,000. Mirae Asset Global Investments Co. Ltd. acquired a new stake in shares of Applied Digital during the third quarter valued at approximately $3,666,000. Americana Partners LLC lifted its position in shares of Applied Digital by 15.4% in the 3rd quarter. Americana Partners LLC now owns 11,266 shares of the company's stock valued at $275,000 after acquiring an additional 1,500 shares in the last quarter. Finally, State of Wyoming lifted its position in shares of Applied Digital by 210.4% in the 3rd quarter. State of Wyoming now owns 6,230 shares of the company's stock valued at $152,000 after acquiring an additional 4,223 shares in the last quarter. 65.67% of the stock is currently owned by institutional investors.

Applied Digital Stock Down 1.3%

The stock has a market cap of $5.32 billion, a price-to-earnings ratio of -10.72 and a beta of 5.59. The business's 50 day moving average is $24.06 and its 200 day moving average is $31.35. The company has a debt-to-equity ratio of 3.90, a quick ratio of 2.56 and a current ratio of 2.56.

Applied Digital (NASDAQ:APLD - Get Free Report) last released its quarterly earnings data on Wednesday, October 7th. The company reported ($0.01) earnings per share for the quarter, beating the consensus estimate of ($0.30) by $0.29. The firm had revenue of $300.39 million for the quarter, compared to analyst estimates of $116.29 million. Applied Digital had a negative net margin of 51.28% and a negative return on equity of 27.21%. The company's revenue for the quarter was up 367.8% compared to the same quarter last year. During the same quarter in the prior year, the business earned ($0.03) EPS. Equities analysts expect that Applied Digital Corporation will post -2.17 earnings per share for the current year.

About Applied Digital

Applied Digital Corporation NASDAQ: APLD develops and operates digital infrastructure designed to support high-performance computing and artificial intelligence applications. The company provides data-center capacity, hosting services and related infrastructure for customers that require substantial computing power and energy resources.

Its business includes high-performance computing data centers and cloud services intended to support artificial intelligence, machine learning, cryptocurrency mining and other compute-intensive workloads.

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