Applied Digital (NASDAQ:APLD) Shares Up 4.5% – Still a Buy?

Applied Digital Corporation (NASDAQ:APLD) shares were up 4.5% on Wednesday. The company traded as high as $20.44 and last traded at $20.39. Approximately 29,249,488 shares traded hands during mid-day trading, an increase of 26% from the average session volume of 23,122,809 shares. The stock had previously closed at $19.51.

Applied Digital News Roundup

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

• Positive Sentiment: Insiders reportedly purchased approximately $7 million of Applied Digital shares during the selloff, signaling that company executives view the decline as an attractive entry point. Applied Digital insiders buy roughly $7M in shares as stock slides
• Positive Sentiment: Applied Digital agreed with Soluna Holdings to develop a jointly owned 50-megawatt critical IT data center in Texas. The project is intended to serve artificial-intelligence and high-performance-computing demand, supporting the company’s growth narrative. Applied Digital shares and Soluna data center agreement
• Positive Sentiment: Some analysts and financial publications continue to identify APLD as a potential rebound candidate because of accelerating data-center demand, backlog growth, and AI monetization. The reported analyst consensus target is $59.75, while B. Riley still rates the stock “Buy” with a $51 target. Applied Digital consensus target price B. Riley lowered Applied Digital price target
• Neutral Sentiment: Coverage comparing Applied Digital with IREN highlights that both companies face investor concerns about risk, making the sector’s recent weakness broader than a single company-specific issue. Should investors buy IREN instead of Applied Digital
• Negative Sentiment: B. Riley reduced its APLD price target from $75 to $51. Although the firm retained a Buy rating and still sees significant upside, the cut reflects a more cautious outlook and may reinforce near-term investor concerns. B. Riley Applied Digital stock recommendation

Analyst Upgrades and Downgrades

A number of research firms have commented on APLD. B. Riley Financial reduced their target price on Applied Digital from $75.00 to $51.00 and set a “buy” rating for the company in a report on Friday. Zacks Research cut shares of Applied Digital from a “hold” rating to a “strong sell” rating in a research note on Wednesday, August 26th. Wall Street Zen downgraded shares of Applied Digital from a “sell” rating to a “strong sell” rating in a report on Sunday, August 30th. Rothschild & Co Redburn set a $22.00 price objective on shares of Applied Digital and gave the company a “neutral” rating in a research note on Monday, September 21st. Finally, Wells Fargo & Company reiterated an “overweight” rating and issued a $55.00 price objective (up from $50.00) on shares of Applied Digital in a research note on Thursday, October 8th. Three analysts have rated the stock with a Strong Buy rating, twelve have issued a Buy rating, two have issued a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat, Applied Digital currently has a consensus rating of “Moderate Buy” and a consensus price target of $57.75.

Applied Digital Trading Down 8.2%

The company has a market cap of $5.39 billion, a price-to-earnings ratio of -10.87 and a beta of 5.99. The company has a debt-to-equity ratio of 3.90, a current ratio of 2.56 and a quick ratio of 2.56. The business’s 50-day simple moving average is $24.27 and its 200-day simple moving average is $31.45.

Applied Digital (NASDAQ:APLD) last posted its quarterly earnings data on Wednesday, October 7th. The company reported ($0.01) EPS for the quarter, topping analysts’ consensus estimates of ($0.30) by $0.29. Applied Digital had a negative return on equity of 27.21% and a negative net margin of 51.28%. The firm had revenue of $300.39 million during the quarter, compared to analysts’ expectations of $116.29 million. During the same quarter last year, the business posted ($0.03) EPS. The firm’s quarterly revenue was up 367.8% compared to the same quarter last year. Research analysts predict that Applied Digital Corporation will post -2.17 earnings per share for the current fiscal year.

Insider Transactions at Applied Digital

In related news, Director Richard N. Nottenburg sold 31,250 shares of the firm’s stock in a transaction on Tuesday, October 13th. The shares were sold at an average price of $21.84, for a total transaction of $682,500.00. Following the completion of the sale, the director directly owned 102,128 shares of the company’s stock, valued at approximately $2,230,475.52. This trade represents a 23.43% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, President Jason Gechen Zhang bought 300,000 shares of the company’s stock in a transaction dated Friday, October 16th. The shares were acquired at an average cost of $18.86 per share, for a total transaction of $5,658,000.00. Following the completion of the transaction, the president owned 2,839,227 shares of the company’s stock, valued at approximately $53,547,821.22. The trade was a 11.81% increase in their position. Additional details regarding this purchase are available in the official SEC disclosure. Company insiders own 9.50% of the company’s stock.

Hedge Funds Weigh In On Applied Digital

A number of hedge funds have recently bought and sold shares of APLD. Situational Awareness LP lifted its stake in Applied Digital by 14.1% during the second quarter. Situational Awareness LP now owns 15,384,616 shares of the company’s stock valued at $574,000 after buying an additional 1,906,178 shares in the last quarter. Equitec Proprietary Markets LLC purchased a new position in shares of Applied Digital in the second quarter worth approximately $312,349,000. Hsbc Holdings PLC increased its position in shares of Applied Digital by 6.2% in the first quarter. Hsbc Holdings PLC now owns 1,240,239 shares of the company’s stock worth $28,377,000 after acquiring an additional 72,460 shares in the last quarter. Sei Investments Co. raised its holdings in shares of Applied Digital by 33.0% during the first quarter. Sei Investments Co. now owns 1,093,701 shares of the company’s stock valued at $25,964,000 after acquiring an additional 271,618 shares during the period. Finally, Janus Henderson Group PLC raised its holdings in shares of Applied Digital by 318.5% during the first quarter. Janus Henderson Group PLC now owns 785,152 shares of the company’s stock valued at $18,638,000 after acquiring an additional 597,548 shares during the period. 65.67% of the stock is currently owned by institutional investors and hedge funds.

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.