Applied Digital (NASDAQ:APLD) Shares Down 6.5% - Here's What Happened

Applied Digital Co. (NASDAQ:APLD) saw its shares drop by 6.5% during mid-day trading on Monday. The stock traded as low as $7.44 before settling at $7.48. A total of 14,702,552 shares changed hands, reflecting a significant decline of 48% from the average trading volume of 28,286,107 shares. The previous closing price for the stock was $8.00.

Wall Street Analysts Provide Insights

Several brokerages have recently updated their outlook on Applied Digital. Notably, Needham & Company LLC reaffirmed a "buy" rating and set a target price of $11.00. HC Wainwright also raised their target price from $10.00 to $12.00 while maintaining a "buy" rating. Additionally, Compass Point started covering Applied Digital with a "buy" recommendation and a price target of $10.00. Northland Securities made a notable adjustment, increasing their price target from $12.00 to $20.00 and designating the stock as "outperform." Meanwhile, Cantor Fitzgerald adjusted their price target down from $15.00 to $14.00 but still rated it as "overweight." Overall, nine analysts have rated the stock as a buy; MarketBeat.com indicates an average target price of $12.11.

Stock Performance Overview

The recent performance of Applied Digital shows a 50-day moving average price of $8.33 and a 200-day moving average price of $7.71. The company's current ratio stands at 0.77, with a quick ratio also at 0.77, and a debt-to-equity ratio of 1.22. With a market capitalization of $1.71 billion, the stock has a PE ratio of -4.45 and a beta of 4.69.

Applied Digital last reported its earnings results on January 14, where it announced an earnings per share (EPS) loss of $0.06 for the quarter. This result surpassed analysts' expectations, which had been set at a loss of $0.14, by $0.08. The company reported revenues of $63.87 million, exceeding the consensus estimate of $62.41 million. This figure represented a year-over-year revenue growth of 51.3%. Analysts predict that Applied Digital will report an EPS of -0.96 for the current fiscal year.

Recent Insider Activity

In other news, Director Richard N. Nottenburg sold 20,000 shares on January 17 at an average price of $8.85, totaling $177,000. Following the sale, Nottenburg retains ownership of 342,923 shares, valued at approximately $3,034,868.55. This transaction reflects a decrease of 5.51% in his position. The sale was documented in a filing with the SEC, where insider ownership is reported to be 11.81%.

Institutional Investor Movements

Recent changes in institutional holdings have also been notable. Wilmington Savings Fund Society FSB doubled its stake in Applied Digital during the fourth quarter, acquiring 4,000 shares valued at $31,000. Other institutional purchases include R Squared Ltd, US Bancorp DE, and Jones Financial, among others. Collectively, hedge funds and institutional investors hold 65.67% of the company's stock.

About Applied Digital

Applied Digital Corporation focuses on designing, developing, and operating data centers throughout North America. It provides crucial digital infrastructure for high-performance computing and offers cloud services for artificial intelligence, along with various hosting services for crypto and high-performance computing.

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