Applied Digital (NASDAQ:APLD) Stock Price Up 2.6% - Should You Buy?

Key Points

• Applied Digital shares rose 2.6% to $25.34 after the company secured access to up to 1 gigawatt of potential power capacity in Finland, its first international development opportunity and a possible foundation for an AI data-center campus.
• The company also brought an additional 75 megawatts of IT load online at Polaris Forge 1, while analysts expect sharply higher revenue. However, continued losses, heavy AI-related spending and execution risks remain concerns.
• Wall Street’s consensus rating is “Moderate Buy”, with an average price target of $60.88, but the stock carries substantial volatility: about 20.9% of its float is sold short, and its beta is 5.99.

Shares of Applied Digital Corporation (NASDAQ:APLD - Get Free Report) shot up 2.6% on Tuesday. The stock traded as high as $25.89 and last traded at $25.34. Approximately 22,449,408 shares changed hands during trading, a decline of 1% from the average session volume of 22,574,396 shares. The stock had previously closed at $24.70.

Key Applied Digital News

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

• Positive Sentiment: Applied Digital secured access to up to 1 gigawatt of potential power capacity in Finland, creating the company’s first international development opportunity and a potential foundation for a large-scale AI data center campus. Management said discussions with hyperscale customers are underway, although near-term execution remains focused on its U.S. pipeline. Applied Digital Secures Up to 1 GW of Potential Power Capacity in Finland
• Positive Sentiment: The Finland agreement gives Applied Digital exposure to Europe’s growing AI infrastructure market and access to Finland’s power, climate and connectivity advantages. Investors appear to view the deal as a long-term growth catalyst. Applied Digital Climbs as Finland Deal Opens Access to 1 GW
• Positive Sentiment: Applied Digital recently brought an additional 75 megawatts of IT load online at Polaris Forge 1, adding to its data-center capacity and supporting expectations for strong future revenue growth. Applied Digital Capacity Expansion Catalyst
• Neutral Sentiment: Investors are focused on the fiscal first-quarter report, with previews pointing to sharply higher revenue expectations but continued losses, substantial AI-related spending and execution risk. Applied Digital to Post Q1 Earnings
• Negative Sentiment: Short interest is elevated, with approximately 20.9% of the float sold short. This signals significant skepticism ahead of earnings and could increase volatility if results or guidance disappoint. Applied Digital Reports With 21% of Its Float Sold Short

Wall Street Analysts Forecast Growth

A number of brokerages have commented on APLD. Rothschild & Co Redburn set a $22.00 target price on shares of Applied Digital and gave the stock a "neutral" rating in a research note on Monday, September 21st. Zacks Research cut shares of Applied Digital from a "hold" rating to a "strong sell" rating in a research note on Wednesday, August 26th. Wells Fargo & Company began coverage on shares of Applied Digital in a report on Thursday, September 17th. They set an "overweight" rating and a $50.00 price target for the company. Lake Street Capital upped their price objective on Applied Digital from $70.00 to $90.00 and gave the company a "buy" rating in a report on Tuesday, June 9th. Finally, Craig Hallum upped their price objective on Applied Digital from $75.00 to $79.00 and gave the company a "buy" rating in a report on Tuesday, June 9th. Three equities research analysts have rated the stock with a Strong Buy rating, thirteen have issued a Buy rating, two have assigned a Hold rating and two have given a Sell rating to the stock. According to MarketBeat.com, Applied Digital currently has an average rating of "Moderate Buy" and an average price target of $60.88.

Applied Digital Stock Performance

The firm's fifty day moving average is $27.17 and its 200-day moving average is $32.57. The company has a current ratio of 4.01, a quick ratio of 4.01 and a debt-to-equity ratio of 2.88. The stock has a market capitalization of $7.39 billion, a PE ratio of -28.47 and a beta of 5.99.

Applied Digital (NASDAQ:APLD - Get Free Report) last announced its earnings results on Monday, July 27th. The company reported ($0.39) earnings per share for the quarter, missing the consensus estimate of ($0.09) by ($0.30). The company had revenue of $240.35 million for the quarter, compared to analysts' expectations of $96.85 million. Applied Digital had a negative return on equity of 16.42% and a negative net margin of 37.78%.The company's quarterly revenue was up 406.3% compared to the same quarter last year. During the same period last year, the business earned ($0.24) EPS. As a group, research analysts anticipate that Applied Digital Corporation will post -1.09 earnings per share for the current year.

Insider Buying and Selling at Applied Digital

In related news, Director Richard Nottenburg sold 75,000 shares of Applied Digital 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 sale, the director owned 133,378 shares in the company, valued at approximately $4,154,724.70. This trade represents a 35.99% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Insiders own 9.50% of the company's stock.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently modified their holdings of the company. Equitec Proprietary Markets LLC acquired a new stake in Applied Digital in the second quarter valued at approximately $312,349,000. Situational Awareness LP grew its holdings in Applied Digital by 18.9% during the 1st quarter. Situational Awareness LP now owns 13,478,438 shares of the company's stock worth $319,978,000 after acquiring an additional 2,139,378 shares in the last quarter. Hsbc Holdings PLC purchased a new stake in shares of Applied Digital in the 4th quarter valued at approximately $29,510,000. Janus Henderson Group PLC raised its holdings in shares of Applied Digital by 318.5% in the 1st quarter. Janus Henderson Group PLC now owns 785,152 shares of the company's stock valued at $18,638,000 after purchasing an additional 597,548 shares in the last quarter. Finally, Dymon Asia Capital Singapore PTE. LTD. purchased a new stake in shares of Applied Digital during the 4th quarter worth $14,222,000. 65.67% of the stock is currently owned by hedge funds and other institutional investors.

Applied Digital Company Profile

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

The company's business has included hosting infrastructure for cryptocurrency-mining operations and, increasingly, developing facilities for artificial intelligence and high-performance computing workloads.

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