Applied Digital (NASDAQ:APLD) Sees 2.3% Increase Following Analyst Upgrade

Applied Digital Co. (NASDAQ:APLD) experienced a rise of 2.3% in share price during mid-day trading on Friday after an upgrade from Lake Street Capital. The firm raised its price target for the stock from $7.00 to $11.00, maintaining a buy rating for Applied Digital. During the trading session, the stock peaked at $7.18 before settling at $7.05, with about 2,670,107 shares traded. This trading volume marked a substantial decline of 60% from the average daily volume of 6,632,921 shares, while the previous closing price was $6.89.

Recent comments from various analysts also contributed to the positive sentiment around APLD. On Thursday, Needham & Company LLC reiterated a “buy” rating and set a price target at $11.00. Craig Hallum increased their target for Applied Digital from $10.00 to $12.00, while maintaining a buy rating. Roth MKM also supported the stock with a reiterated buy rating and a price target of $10.00. HC Wainwright issued a buy rating with a $5.00 target in late August, and B. Riley recently raised their price objective to $9.00, assigning a buy rating as well. In total, six analysts have given APLD a buy rating, resulting in a consensus rating of “Buy” and an average price target of $9.67 according to MarketBeat.com.

Insider Transactions

In other news regarding insider activity, Douglas S. Miller, a director at Applied Digital, sold 10,000 shares of the company on September 5th for an average price of $5.50, amounting to $55,000. Following this transaction, Miller retains ownership of 218,506 shares valued at approximately $1,201,783. This sale represented a negligible change in his ownership percentage. It is noted that company insiders collectively own about 20.50% of the stock.

Institutional Investor Activity

There has been notable activity among institutional investors regarding Applied Digital. Vanguard Group Inc. increased its stake in the company by 70.2% during the first quarter, now holding 6,176,073 shares, valued at approximately $26.43 million. Van ECK Associates Corp also bolstered its holdings, raising its position by 92.1% and holding 2,426,281 shares worth about $10.38 million. Additionally, Hood River Capital Management LLC increased its stake by 8.7% during the second quarter, totaling 9,596,231 shares with a value of $57.1 million. Alight Capital Management LP acquired a new position in the stock valued at $3.57 million during the second quarter, while Mirae Asset Global Investments raised its stake significantly by 69.3% in the first quarter, now owning 1,311,594 shares. Overall, institutional investors own around 65.67% of Applied Digital's stock.

Recent Stock Performance

Applied Digital's stock has shown substantial performance recently, moving up 5.7%. The current fifty-day moving average stands at $5.48, while the two-hundred day moving average is $4.77. Financial metrics reveal a current ratio and quick ratio of 0.08 each, alongside a debt-to-equity ratio of 1.14. The company's market capitalization is approximately $1.56 billion, with a PE ratio of -6.20 and a beta of 4.56.

On October 9th, Applied Digital announced its latest earnings report, revealing a loss of $0.15 per share for the quarter, which was better than analysts' estimates of a loss of $0.28 per share. However, the company reported a negative net margin of 74.95%, and a negative return on equity of 107.05%. Their revenue for the quarter reached $60.70 million, surpassing expectations of $54.85 million, and reflecting a substantial growth of 67.2% year-over-year. Analysts forecast that the company will report an EPS of -1.12 for the current year.

Company Overview

Applied Digital Corporation is primarily focused on designing, developing, and operating data centers in North America. These facilities offer digital infrastructure solutions catered to the high-performance computing sector. The company specializes in providing services related to artificial intelligence cloud, high-performance computing data center hosting, and crypto data center hosting.

Further Information

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