Applied Digital (NASDAQ:APLD) Cut to “Strong Sell” at Zacks Research

Zacks Research cut shares of Applied Digital (NASDAQ:APLD) from a hold rating to a strong sell rating in a research report sent to investors on Wednesday morning,Zacks.com reports.

Several other research firms have also recently weighed in on APLD. Citizens Jmp reaffirmed a “market outperform” rating and issued a $40.00 price target on shares of Applied Digital in a report on Thursday. B. Riley Financial lifted their price objective on Applied Digital to $53.00 and gave the stock a “buy” rating in a research report on Friday, January 9th. Arete Research initiated coverage on Applied Digital in a research note on Wednesday, January 7th. They issued a “buy” rating for the company. Freedom Capital upgraded shares of Applied Digital to a “strong-buy” rating in a report on Tuesday, January 6th. Finally, Needham & Company LLC reissued a “buy” rating and issued a $41.00 target price on shares of Applied Digital in a report on Thursday, January 8th. Two analysts have rated the stock with a Strong Buy rating, twelve have given a Buy rating and two have assigned a Sell rating to the company’s stock. Based on data from MarketBeat, Applied Digital has a consensus rating of “Moderate Buy” and an average target price of $39.20.

Applied Digital Price Performance

APLD stock opened at $26.26 on Wednesday. Applied Digital has a 12-month low of $3.31 and a 12-month high of $42.27. The company has a quick ratio of 4.82, a current ratio of 2.38 and a debt-to-equity ratio of 1.65. The company’s fifty day simple moving average is $28.88 and its 200 day simple moving average is $29.46. The firm has a market cap of $7.50 billion, a price-to-earnings ratio of -35.48 and a beta of 7.25.

Applied Digital (NASDAQ:APLD) last announced its quarterly earnings data on Wednesday, April 8th. The company reported ($0.36) earnings per share for the quarter, missing the consensus estimate of ($0.13) by ($0.23). The company had revenue of $108.55 million for the quarter, compared to analyst estimates of $78.47 million. Applied Digital had a negative net margin of 52.84% and a negative return on equity of 15.91%. Applied Digital’s revenue for the quarter was up 139.3% on a year-over-year basis. During the same quarter in the prior year, the company posted ($0.08) EPS. On average, analysts expect that Applied Digital will post -0.96 earnings per share for the current year.

Insider Activity

In other news, Director Douglas S. Miller sold 10,000 shares of the company’s stock in a transaction that occurred on Monday, January 12th. The stock was sold at an average price of $38.54, for a total transaction of $385,400.00. Following the sale, the director directly owned 200,859 shares of the company’s stock, valued at $7,741,105.86. This represents a 4.74% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Chuck Hastings sold 45,987 shares of the company’s stock in a transaction dated Thursday, January 29th. The shares were sold at an average price of $38.57, for a total transaction of $1,773,718.59. Following the sale, the director owned 388,372 shares in the company, valued at $14,979,508.04. This represents a 10.59% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 244,593 shares of company stock worth $9,003,278 in the last quarter. Corporate insiders own 9.50% of the company’s stock.

Institutional Investors Weigh In On Applied Digital

Hedge funds and other institutional investors have recently made changes to their positions in the company. Noble Wealth Management PBC purchased a new stake in Applied Digital in the 4th quarter worth about $25,000. Albion Financial Group UT purchased a new stake in shares of Applied Digital in the fourth quarter worth approximately $25,000. Activest Wealth Management purchased a new stake in shares of Applied Digital in the fourth quarter worth approximately $25,000. Ameriflex Group Inc. purchased a new stake in shares of Applied Digital in the fourth quarter worth approximately $25,000. Finally, McMillan Office Inc. purchased a new position in Applied Digital in the 4th quarter worth about $25,000. Hedge funds and other institutional investors own 65.67% of the company’s stock.

Key Headlines Impacting Applied Digital

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

• Positive Sentiment: Q3/Q1 revenue beat and rapid growth: APLD reported revenue that surged ~139% Y/Y and exceeded Wall Street expectations, with non‑GAAP profit above estimates—fueling optimism about demand for AI/data‑center capacity. APLD Q1 Deep Dive
• Positive Sentiment: Major capacity expansion and improved lease economics: Applied broke ground on the 300 MW Delta Forge 1 AI campus, recast leases with hyperscaler CoreWeave (improving credit metrics and lowering cost of capital) and reiterated high‑growth NOI targets. These moves underpin the company’s long‑term AI/data‑center thesis. Applied Digital Expands AI Campus
• Positive Sentiment: Analyst / options flow support: Citizens Jmp reaffirmed a Market Outperform rating with a $40 target, and intraday reports show heavy call‑option activity—both signal institutional and speculative bullish interest. Citizens Jmp rating Options Flow
• Neutral Sentiment: Short interest report shows effectively zero reported short interest (odd/possibly stale data); days‑to‑cover is negligible—this lowers squeeze risk but the data may be unreliable. (internal short‑interest entry)
• Neutral Sentiment: Analyst/think pieces weigh pros and cons: Several deep dives (Seeking Alpha) argue APLD is a long‑term winner in the AI CapEx boom while flagging emerging risks from leverage and cash burn. Still A Buy Despite Emerging Risks Winner In The AI CapEx Boom
• Negative Sentiment: Wider GAAP loss, write‑downs and stock‑based comp weighed on sentiment: Despite the revenue beat, APLD reported a larger net loss than expected and flagged significant non‑cash charges and expanded operating losses—key reasons some investors sold into the rally. Q3 Results — Loss Wider
• Negative Sentiment: Downgrade and cautionary headlines: Zacks moved APLD to a “strong sell” and multiple outlets cautioned about massive cash burn, weak near‑term EPS outlook and a spin‑off charge—pressures that can keep the stock volatile and cap upside. Zacks downgrade Should You Buy the Dip?
• Negative Sentiment: Market reaction so far: Multiple headlines note the stock fell after the beat earlier in the session as investors focused on losses and cash burn; that same tension explains today’s seesaw price action. Why APLD Stock Is Falling

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.