Applied Digital Rises 2.2% as Analysts Point to More Than 100% Upside
Key Takeaways
- •Applied Digital's quarterly revenue of $240.35 million represented a 406.3% year-over-year increase and easily surpassed the analyst consensus estimate of $96.85 million.
- •The company reported a loss of $0.39 per share, missing the consensus estimate of -$0.09 and reflecting a net margin of -37.78%.
- •Analysts maintain a 'Moderate Buy' consensus rating with an average price target of $68.15, more than double the current share price of $29.69.
- •Director Richard N. Nottenburg sold 75,000 shares on August 4 for approximately $2.34 million, reducing his personal holdings by about 36%.
- •Institutional and hedge fund ownership stands at 65.67% of the total float, with multiple firms adding positions in recent quarters.
Applied Digital (APLD) rose 2.2% on Tuesday, reaching $29.69 during intraday trading before the session closed. Volume totaled about 11.8 million shares, roughly 51% below the daily average of 24.1 million.
Applied Digital Corp. has a beta of 5.75, making it one of the more volatile names in the AI infrastructure space. The stock is currently trading below both its 50-day moving average of $35.10 and its 200-day moving average of $34.03.
The company’s latest quarter produced sharply mixed results. Revenue reached $240.35 million, up 406.3% from the same period a year earlier and well above the analyst estimate of $96.85 million. The result marked a significant top-line beat and helps explain why the stock continues to draw attention even after periods of weakness.
Earnings, however, fell short of expectations. Applied Digital reported a loss of $0.39 per share, compared with the consensus estimate of -$0.09. Net margin was -37.78%, and return on equity was -16.42%. Analysts currently expect full-year EPS of -$1.08, underscoring that investors are still weighing rapid revenue growth against continued losses.
Analyst ratings
Wall Street has not backed away from the stock despite the earnings miss. Applied Digital carries a consensus rating of “Moderate Buy,” based on 3 Strong Buy ratings, 11 Buy ratings, 2 Hold ratings, and 1 Sell rating.
Price targets currently range from $65 to $83. On August 3, B. Riley raised its target from $66 to $75. On July 28, Needham reiterated its $83 target, and Citigroup reissued a “market outperform” rating on the same day as B. Riley’s update.
The average price target is $68.15, which is well above the current share price of $29.69 and reflects continued analyst interest in the company’s role in AI infrastructure buildout.
Insider and institutional activity
Director Richard N. Nottenburg sold 75,000 shares on August 4 at an average price of $31.15, for total proceeds of $2.34 million. The sale reduced his position by about 36% and left him with 133,378 shares. Insiders collectively own 9.50% of the stock.
Institutional activity has also been notable in recent quarters. Whitaker Myers Wealth Managers acquired 49,354 shares worth about $1.84 million in the second quarter. Cannon Capital Management added $3.64 million worth of shares in the fourth quarter, and Mirae Asset added $2.67 million.
Institutional and hedge fund ownership stands at 65.67% of the total float.
Applied Digital has a 12-month trading range of $13.16 to $50.72. The company’s market capitalization is approximately $8.65 billion, its debt-to-equity ratio is 2.88, and its current ratio is 4.01.
