Applied Digital Corporation (NASDAQ: APLD) experienced a decline of 4% in its stock price on Monday, trading as low as $35.72 before closing at $36.18. The trading session saw approximately 47,817,189 shares exchanged, marking a 10% increase from the average daily volume of 43,527,031 shares. This dip follows a previous closing price of $37.69.
Analyst Ratings and Market Reactions
Analyst reports have varied in their outlook on Applied Digital. On January 8, 2024, Needham & Company LLC maintained a “buy” rating with a price target of $41.00. Similarly, Freedom Capital upgraded its rating to “strong-buy” on January 6, 2024. Citigroup reaffirmed an “outperform” rating on December 30, 2023, while Texas Capital also boosted its rating to “strong-buy” on January 20, 2024. In contrast, Wall Street Zen adjusted its rating from “sell” to “hold” on January 10, 2024.
Currently, three analysts have assigned a “strong buy” rating, twelve have issued a “buy” rating, and one analyst has a “sell” rating for the stock. According to MarketBeat.com, Applied Digital holds a consensus rating of “buy” with a price target of $33.27.
Financial Performance and Insider Activity
Applied Digital recently reported its quarterly earnings on January 7, 2024. The company posted an earnings per share (EPS) of ($0.11), falling short of analysts’ expectations of ($0.09) by ($0.02). Despite this, the company’s revenue for the quarter reached $126.59 million, significantly surpassing the consensus estimate of $82.22 million. Year-over-year, revenue increased by 250.1%, although the company reported a negative return on equity of 13.53% and a negative net margin of 43.49%.
Insider trading activity has also been noteworthy. Director Richard N. Nottenburg sold 12,000 shares of the company on January 15, 2024, at an average price of $35.45, totaling $425,400. Following this transaction, Nottenburg retained 233,378 shares valued at approximately $8.27 million. Additionally, Director Ella G. Benson sold 42,569 shares on October 29, 2023 for around $1.5 million, reducing her ownership by 38.07%.
In total, insiders have sold 368,053 shares, amounting to $13.25 million in the past 90 days, and currently hold 9.50% of the company’s stock.
Institutional investors have also shown interest in Applied Digital, with Voya Investment Management LLC increasing its holdings by 403.4% in the third quarter. The firm now owns 1,464,909 shares valued at $33.6 million, having acquired 1,173,929 shares during that period. Other notable transactions include Chelsea Counsel Co. purchasing a new stake worth approximately $582,000 and KLP Kapitalforvaltning AS increasing its position by 27.7% in the second quarter.
As it stands, institutional investors hold 65.67% of Applied Digital’s stock.
Applied Digital Corporation is recognized for its role in developing large-scale digital infrastructure and sustainable Bitcoin mining solutions. The company designs and operates data center facilities, offering diverse hosting services for cloud and enterprise computing. Its innovative approach allows for rapid deployment and efficient integration of critical resources such as power and cooling.
