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

Applied Digital Corporation (NASDAQ:APLD)’s share price gapped up before the market opened on Wednesday . The stock had previously closed at $25.18, but opened at $28.45. Applied Digital shares last traded at $28.0020, with a volume of 10,452,369 shares.

Key Applied Digital News

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

• Positive Sentiment: Revenue and AI demand beat — Q3 revenue surged ~139% y/y and management reported stronger-than-expected top-line results and non-GAAP profit, supporting the growth thesis from AI data-center demand. Applied Digital beats quarterly revenue estimates
• Positive Sentiment: Big AI campus expansion — Applied Digital broke ground on the 300 MW Delta Forge 1 AI campus and recast hyperscaler leases (CoreWeave), aiming to scale capacity and drive future NOI growth toward management’s multi-year target. This underscores durable demand for capacity. Applied Digital Expands AI Campus
• Positive Sentiment: Analyst support — Citizens Jmp reaffirmed a Market Outperform and a $40 price target, signaling continued buy-side conviction on the long-term AI play. Market Outperform Reaffirmed at Citizens Jmp
• Neutral Sentiment: Elevated bullish options activity — Unusual volume of call purchases suggests speculative/leveraged bullish positioning that can amplify intraday moves both up and down. Traders Purchase Large Volume of Call Options
• Negative Sentiment: Zacks downgrade to “Strong Sell” — Zacks moved APLD to its Rank #5 (Strong Sell), adding downward pressure via sentiment and potential model-driven selling. Zacks.com
• Negative Sentiment: Wider-than-expected GAAP loss and charges — The company reported a larger net loss (EPS -$0.36) driven by write-downs, stock‑based comp and a spin‑off charge that overwhelmed the revenue beat and spooked investors focused on near-term profitability. Applied Digital Q3 Loss Wider Than Expected
• Negative Sentiment: Cash burn, debt and interest-rate risk — Analysts and coverage pieces highlight rising debt, higher interest costs from rapid expansion, and a challenging near-term earnings outlook that increase execution risk and valuation sensitivity. Can APLD Navigate Rising Interest Costs

Analyst Ratings Changes

Several equities analysts have weighed in on the company. Lake Street Capital reissued a “buy” rating and set a $45.00 price target on shares of Applied Digital in a research report on Tuesday, December 30th. B. Riley Financial raised their price target on Applied Digital to $53.00 and gave the stock a “buy” rating in a research report on Friday, January 9th. Citigroup reissued an “outperform” rating on shares of Applied Digital in a research report on Wednesday, January 28th. Freedom Capital raised Applied Digital to a “strong-buy” rating in a research report on Tuesday, January 6th. Finally, Texas Capital raised Applied Digital to a “strong-buy” rating in a research report on Tuesday, January 20th. Two research analysts have rated the stock with a Strong Buy rating, twelve have assigned a Buy rating and two have given a Sell rating to the stock. Based on data from MarketBeat, Applied Digital currently has a consensus rating of “Moderate Buy” and an average target price of $39.20.

Applied Digital Stock Down 8.0%

The firm has a fifty day moving average price of $29.04 and a 200-day moving average price of $29.44. The company has a quick ratio of 4.82, a current ratio of 4.82 and a debt-to-equity ratio of 1.79. The firm has a market cap of $7.15 billion, a price-to-earnings ratio of -34.55 and a beta of 7.25.

Applied Digital (NASDAQ:APLD) last posted its quarterly earnings data on Wednesday, April 8th. The company reported ($0.36) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.13) by ($0.23). Applied Digital had a negative return on equity of 18.24% and a negative net margin of 52.84%.The business had revenue of $108.55 million for the quarter, compared to analyst estimates of $78.47 million. During the same quarter last year, the business earned ($0.08) EPS. Applied Digital’s revenue for the quarter was up 139.3% compared to the same quarter last year. As a group, sell-side analysts forecast that Applied Digital Corporation will post -0.96 EPS for the current year.

Insider Transactions at Applied Digital

In related news, CEO Wes Cummins sold 165,000 shares of Applied Digital stock in a transaction on Friday, January 16th. The stock was sold at an average price of $36.42, for a total value of $6,009,300.00. Following the transaction, the chief executive officer owned 4,176,329 shares in the company, valued at approximately $152,101,902.18. This trade represents a 3.80% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, Director Douglas S. Miller sold 10,000 shares of Applied Digital stock in a transaction on Monday, January 12th. The shares were sold at an average price of $38.54, for a total value of $385,400.00. Following the completion of the transaction, the director owned 200,859 shares in the company, valued at $7,741,105.86. The trade was a 4.74% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 244,593 shares of company stock worth $9,003,278 over the last ninety days. 9.50% of the stock is owned by insiders.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in APLD. Noble Wealth Management PBC acquired a new position in Applied Digital in the fourth quarter valued at $25,000. Albion Financial Group UT acquired a new position in Applied Digital in the fourth quarter valued at $25,000. Activest Wealth Management acquired a new position in Applied Digital in the fourth quarter valued at $25,000. Ameriflex Group Inc. acquired a new position in Applied Digital in the fourth quarter valued at $25,000. Finally, McMillan Office Inc. acquired a new position in Applied Digital in the fourth quarter valued at $25,000. Institutional investors and hedge funds own 65.67% of the company’s stock.

About Applied Digital

Applied Digital (NASDAQ: APLD) is a technology company specializing in the development and operation of large-scale digital infrastructure and sustainable Bitcoin mining solutions. Through its integrated platform, the company designs, builds and manages turnkey data center facilities while also providing comprehensive hosting services for cloud, colocation and enterprise computing needs. Applied Digital’s modular approach to facility design enables rapid deployment of capacity and streamlined integration of power, cooling and network connectivity.

In addition to its data center business, Applied Digital operates a network of Bitcoin mining sites that leverage vertically integrated capabilities, including hardware procurement, mining farm engineering, energy management and real-time performance monitoring.