Wall Street Zen Downgrades Applied Digital (NASDAQ:APLD) to Sell

Key Points

• Applied Digital (NASDAQ:APLD) was downgraded from a "hold" rating to a "sell" rating by Wall Street Zen as of Sunday.
• Despite the downgrade, other analysts such as Citigroup and Northland Securities have given Applied Digital an "outperform" rating with varying price targets reaching up to $40.00.
• In its recent earnings report, Applied Digital reported a revenue of $38.01 million but fell short of the analyst consensus estimate of $52.25 million, indicating potential challenges ahead.

Applied Digital (NASDAQ:APLD - Get Free Report) was downgraded by equities research analysts at Wall Street Zen from a "hold" rating to a "sell" rating in a report issued on Sunday.

Several other research analysts have also commented on APLD. Citigroup reiterated an "outperform" rating on shares of Applied Digital in a research report on Thursday, October 9th. Northland Securities raised their price target on Applied Digital to $40.00 and gave the stock an "outperform" rating in a report on Friday, October 10th. Compass Point initiated coverage on Applied Digital in a report on Monday, September 15th. They issued a "buy" rating on the stock. Craig Hallum raised their price target on Applied Digital from $12.00 to $23.00 and gave the stock a "buy" rating in a report on Monday, August 18th. Finally, Needham & Company LLC raised their price target on Applied Digital from $12.00 to $16.00 and gave the stock a "buy" rating in a report on Thursday, July 31st. One research analyst has rated the stock with a Strong Buy rating, eleven have given a Buy rating and one has assigned a Sell rating to the company. According to data from MarketBeat, the company currently has an average rating of "Moderate Buy" and an average price target of $22.10.

Applied Digital Price Performance

Shares of APLD opened at $34.24 on Friday. The firm has a market cap of $9.58 billion, a price-to-earnings ratio of -30.30 and a beta of 6.77. The stock has a 50 day moving average of $21.05 and a 200-day moving average of $12.87. The company has a current ratio of 0.65, a quick ratio of 0.65 and a debt-to-equity ratio of 0.29. Applied Digital has a 52 week low of $3.31 and a 52 week high of $40.20.

Applied Digital (NASDAQ:APLD - Get Free Report) last issued its earnings results on Thursday, October 9th. The company reported ($0.03) EPS for the quarter, topping the consensus estimate of ($0.11) by $0.08. The company had revenue of $38.01 million during the quarter, compared to analyst estimates of $52.25 million. Applied Digital had a negative return on equity of 37.14% and a negative net margin of 111.29%.The business's revenue was up 84.3% on a year-over-year basis. During the same quarter last year, the firm earned ($0.15) EPS. As a group, analysts forecast that Applied Digital will post -0.96 EPS for the current year.

Insider Buying and Selling at Applied Digital

In other Applied Digital news, Director Richard N. Nottenburg sold 20,000 shares of Applied Digital stock in a transaction on Wednesday, September 3rd. The stock was sold at an average price of $15.26, for a total transaction of $305,200.00. Following the sale, the director owned 297,987 shares of the company's stock, valued at $4,547,281.62. The trade was a 6.29% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, CFO Mohammad Saidal Lavanw Mohmand sold 75,000 shares of Applied Digital stock in a transaction on Wednesday, September 3rd. The shares were sold at an average price of $15.26, for a total value of $1,144,500.00. Following the sale, the chief financial officer directly owned 201,800 shares in the company, valued at $3,079,468. The trade was a 27.10% decrease in their position. The disclosure for this sale can be found here. Insiders have sold 506,250 shares of company stock valued at $7,713,675 in the last quarter. Corporate insiders own 9.50% of the company's stock.

Hedge Funds Weigh In On Applied Digital

Hedge funds have recently modified their holdings of the stock. Atlantic Union Bankshares Corp acquired a new position in shares of Applied Digital in the 2nd quarter worth $25,000. Northwestern Mutual Wealth Management Co. purchased a new position in shares of Applied Digital during the second quarter valued at $26,000. PNC Financial Services Group Inc. acquired a new stake in Applied Digital during the first quarter valued at $28,000. Geneos Wealth Management Inc. boosted its position in Applied Digital by 113.3% during the first quarter. Geneos Wealth Management Inc. now owns 6,667 shares of the company's stock valued at $37,000 after purchasing an additional 3,542 shares during the last quarter. Finally, Ameriflex Group Inc. acquired a new stake in Applied Digital during the second quarter valued at $42,000. 65.67% of the stock is currently owned by institutional investors and hedge funds.

About Applied Digital

Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services.

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