Applied Digital (NASDAQ:APLD) Stock Price Up 3.6% - Here's What Happened

Key Points

• Applied Digital shares rose 3.6% to $25.41 in mid-day trading, with about 15.9 million shares changing hands.
• Analyst sentiment is broadly positive, with a “Moderate Buy” consensus and an average price target of $60.88; bullish targets range as high as $90. The company also cites a roughly $31 billion contracted backlog tied to AI and high-performance-computing data centers.
• Risks remain significant: Applied Digital is unprofitable, missed its latest EPS estimate despite revenue rising 406%, faces potential share-sale dilution and insider selling, and was placed on Zacks’ Rank #5 Strong Sell list.

Applied Digital Corporation (NASDAQ:APLD - Get Free Report)'s share price traded up 3.6% during mid-day trading on Tuesday. The stock traded as high as $25.67 and last traded at $25.41. Approximately 15,909,712 shares changed hands during mid-day trading, a decline of 30% from the average daily volume of 22,613,729 shares. The stock had previously closed at $24.53.

Key Applied Digital News

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

• Positive Sentiment: Jones Trading initiated coverage with a Buy rating and a $70 price target. Other analysts have issued targets ranging from $60 to $90, with a reported median target of $79, reflecting substantial potential upside if Applied Digital executes on its data-center expansion and AI infrastructure strategy. Applied Digital analyst coverage
• Positive Sentiment: Applied Digital has highlighted a contracted backlog of roughly $31 billion, supporting the long-term growth case for its high-performance computing and artificial-intelligence data centers. Applied Digital contracted backlog
• Positive Sentiment: Management scheduled its fiscal first-quarter 2027 results and conference call for October 7. The report will provide an important update on backlog conversion, operating performance, financing needs, and demand for AI infrastructure. Applied Digital earnings announcement
• Neutral Sentiment: Analysts are divided ahead of earnings: some view APLD as materially undervalued, while others question whether its rapid share-price appreciation and large lease commitments are justified by current revenue and earnings.
• Negative Sentiment: Zacks added APLD to its Rank #5 Strong Sell list, adding to concerns about near-term earnings momentum and valuation. Zacks Strong Sell list
• Negative Sentiment: Investors are weighing a prospectus covering up to 53.1 million shares that selling stockholders may resell, creating a potential supply overhang. Reported insider activity has also consisted of sales rather than purchases.
• Negative Sentiment: Applied Digital’s latest reported quarter missed EPS expectations, despite very strong revenue growth, and the company remains unprofitable. Elevated interest rates and weakness in high-beta technology stocks are additional pressures on the shares.

Wall Street Analysts Forecast Growth

A number of research firms recently weighed in on APLD. B. Riley Financial reaffirmed a "buy" rating and issued a $75.00 price objective (up from $66.00) on shares of Applied Digital in a report on Monday, August 3rd. Craig Hallum boosted their price target on shares of Applied Digital from $75.00 to $79.00 and gave the company a "buy" rating in a report on Tuesday, June 9th. Rothschild & Co Redburn set a $22.00 price objective on shares of Applied Digital and gave the stock a "neutral" rating in a research note on Monday, September 21st. Weiss Ratings restated a "sell (d-)" rating on shares of Applied Digital in a research note on Tuesday, July 21st. Finally, Lake Street Capital lifted their price target on shares of Applied Digital from $70.00 to $90.00 and gave the stock a "buy" rating in a research note on Tuesday, June 9th. Three research analysts have rated the stock with a Strong Buy rating, thirteen have assigned a Buy rating, two have given a Hold rating and two have assigned a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average target price of $60.88.

Applied Digital Trading Up 3.6%

The firm has a market cap of $7.41 billion, a P/E ratio of -28.55 and a beta of 5.72. The company's fifty day moving average price is $27.56 and its two-hundred day moving average price is $32.67. The company has a current ratio of 4.01, a quick ratio of 4.01 and a debt-to-equity ratio of 2.88.

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

Insider Buying and Selling at Applied Digital

In other Applied Digital news, Director Richard Nottenburg sold 75,000 shares of the business's stock in a transaction dated Tuesday, August 4th. The stock was sold at an average price of $31.15, for a total transaction of $2,336,250.00. Following the completion of the sale, the director directly owned 133,378 shares of the company's stock, valued at approximately $4,154,724.70. The trade was a 35.99% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through the SEC website. 9.50% of the stock is currently owned by insiders.

Hedge Funds Weigh In On Applied Digital

Institutional investors have recently modified their holdings of the stock. FNY Investment Advisers LLC acquired a new position in Applied Digital during the second quarter valued at approximately $37,000. Osbon Capital Management LLC acquired a new stake in Applied Digital in the fourth quarter worth $28,000. Bartlett & CO. Wealth Management LLC boosted its position in shares of Applied Digital by 244.3% during the first quarter. Bartlett & CO. Wealth Management LLC now owns 1,205 shares of the company's stock worth $29,000 after purchasing an additional 855 shares in the last quarter. Ancora Advisors LLC bought a new position in shares of Applied Digital during the second quarter worth $56,000. Finally, Creative Financial Designs Inc. ADV raised its stake in Applied Digital by 691.8% during the 2nd quarter. Creative Financial Designs Inc. ADV now owns 1,536 shares of the company's stock worth $57,000 after buying an additional 1,342 shares during the period. 65.67% of the stock is currently owned by institutional investors and hedge funds.

Applied Digital Company Profile

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

The company's facilities are designed to support advanced computing workloads, including AI model development, cloud computing and digital asset-related applications.

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