Applied Digital (NASDAQ:APLD) Shares Down 9% – Should You Sell?

Applied Digital Corporation (NASDAQ:APLD)’s stock price traded down 9% during mid-day trading on Thursday. The company traded as low as $18.72 and last traded at $19.09. 26,528,714 shares traded hands during trading, an increase of 15% from the average session volume of 23,136,164 shares. The stock had previously closed at $20.98.

More Applied Digital News

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

• Positive Sentiment: Applied Digital agreed with Soluna Holdings to develop a 50-megawatt AI and high-performance-computing data center at the Dorothy 3 site in Texas. Applied will own 51% of the joint venture, and the facility is expected to use power from a nearby wind farm, supporting the company’s strategy of expanding AI infrastructure. Soluna Holdings and Applied Digital Partner to Develop 50 MW AI-Focused Data Center in Texas
• Positive Sentiment: Applied’s majority-owned neocloud business, ChronoScale, signed a nonbinding letter of intent to lease the site. A future lease could provide an anchor customer, although it is not yet a binding revenue contract. Soluna and Applied Digital to build 50 MW wind-powered AI data center in Texas
• Positive Sentiment: Roth/MKM reinstated coverage with a Buy rating and a $35 price target, implying substantial upside from recent levels. The bullish call adds support to the AI-data-center growth thesis after APLD shares had fallen sharply over the past year. Roth/MKM Reinstates Applied Digital at Buy
• Positive Sentiment: Strong industry commentary about limited power availability and sustained AI infrastructure demand helped lift Applied Digital alongside other data-center stocks. Reports also highlighted recent insider buying as a supporting signal. TeraWulf Jumps as Power Demand Remains Extremely Strong

Wall Street Analysts Forecast Growth

Several equities analysts recently weighed in on APLD shares. Weiss Ratings reaffirmed a “sell (d-)” rating on shares of Applied Digital in a research note on Monday. Zacks Research cut shares of Applied Digital from a “hold” rating to a “strong sell” rating in a research note on Wednesday, August 26th. Roth Capital set a $35.00 target price on Applied Digital and gave the stock a “buy” rating in a research report on Wednesday. UBS Group reissued a “buy” rating on shares of Applied Digital in a research note on Thursday, October 8th. Finally, Wall Street Zen cut shares of Applied Digital from a “sell” rating to a “strong sell” rating in a research report on Sunday, August 30th. Three investment analysts have rated the stock with a Strong Buy rating, twelve have given a Buy rating, two have assigned a Hold rating and two have assigned a Sell rating to the company’s stock. According to MarketBeat, the stock has an average rating of “Moderate Buy” and a consensus target price of $59.75.

Applied Digital Stock Down 9.0%

The company has a current ratio of 2.56, a quick ratio of 2.56 and a debt-to-equity ratio of 3.90. The company has a market cap of $5.77 billion, a price-to-earnings ratio of -11.64 and a beta of 5.99. The business has a fifty day moving average of $25.51 and a two-hundred day moving average of $32.26.

Applied Digital (NASDAQ:APLD) last issued its quarterly earnings results on Wednesday, October 7th. The company reported ($0.01) EPS for the quarter, topping the consensus estimate 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 period in the previous year, the business earned ($0.03) earnings per share. The firm’s revenue for the quarter was up 367.8% on a year-over-year basis. As a group, equities analysts anticipate that Applied Digital Corporation will post -2.06 EPS for the current fiscal year.

Insider Buying and Selling at Applied Digital

In related news, CEO Wes Cummins acquired 55,803 shares of the stock in a transaction that occurred on Friday, October 16th. The stock was purchased at an average price of $18.04 per share, with a total value of $1,006,686.12. Following the transaction, the chief executive officer owned 5,874,453 shares of the company’s stock, valued at approximately $105,975,132.12. This trade represents a 0.96% increase in their position. The acquisition was disclosed in a filing with the SEC, which is available at the SEC website. Also, President Jason Gechen Zhang acquired 300,000 shares of the company’s stock in a transaction dated Friday, October 16th. The stock was purchased at an average cost of $18.86 per share, with a total value of $5,658,000.00. Following the completion of the purchase, the president directly owned 2,839,227 shares of the company’s stock, valued at approximately $53,547,821.22. This represents a 11.81% increase in their position. The disclosure for this purchase is available in the SEC filing. Company insiders own 9.50% of the company’s stock.

Institutional Trading of Applied Digital

Several hedge funds have recently modified their holdings of APLD. FNY Investment Advisers LLC purchased a new stake in shares of Applied Digital during the second quarter worth approximately $37,000. Bartlett & CO. Wealth Management LLC grew its stake in Applied Digital by 244.3% during the 1st quarter. Bartlett & CO. Wealth Management LLC now owns 1,205 shares of the company’s stock worth $29,000 after buying an additional 855 shares during the last quarter. Ancora Advisors LLC purchased a new stake in Applied Digital in the 2nd quarter valued at $56,000. Creative Financial Designs Inc. ADV raised its holdings in shares of Applied Digital by 691.8% in the second quarter. Creative Financial Designs Inc. ADV now owns 1,536 shares of the company’s stock valued at $57,000 after buying an additional 1,342 shares during the last quarter. Finally, GAMMA Investing LLC grew its stake in shares of Applied Digital by 28.5% in the 2nd quarter. GAMMA Investing LLC now owns 2,092 shares of the company’s stock valued at $78,000 after purchasing an additional 464 shares during the last quarter. 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.