Remember that friend who bought Bitcoin at $100 and won’t shut up about it? Well, Applied Digital (NASDAQ: APLD) investors are basically that friend right now – except they have every right to be smug. This data center darling just popped another 14% on Friday, bringing its year-to-date gains to a jaw-dropping 255%. Yeah, you read that right.
So what’s the deal this time?
Applied Digital just scored a sweet financing arrangement with Macquarie Group – think of it as getting approved for a really, really good credit card, except instead of buying stuff you don’t need, they’re building AI data centers that everyone desperately wants.
The initial draw is $100 million, which sounds like a lot until you realize they’re in “advanced negotiations” with what they’re calling an “investment-grade hyperscaler.” That’s fancy talk for “one of the big tech companies that shall remain nameless but probably rhymes with Smamazon or Shoogle.”
Why everyone’s losing their minds over data centers
Here’s the thing about AI – it’s hungry. Like, really hungry. Every time ChatGPT writes you a poem or Midjourney creates another cursed image, it’s chomping through massive amounts of computing power. And all that computing needs to live somewhere, preferably in a climate-controlled building with more backup power than a small country.
Applied Digital gets this. They’ve got two campuses in North Dakota (because apparently that’s where the magic happens), with one leased to CoreWeave and another getting ready for a mystery hyperscaler in early 2026.
The numbers that make analysts drool
Let’s talk money, because that’s why we’re all here. Applied Digital’s revenue jumped 84% year-over-year to $64 million last quarter. But here’s where it gets spicy – they’re sitting on $11 billion in contract value from their CoreWeave deal alone, plus another $5 billion from their mystery hyperscaler tenant.
CEO Wes Cummins is basically planning to print money, targeting $1 billion in net operating income within five years. That’s not a typo – billion with a B.
The analyst love fest
Wall Street is basically throwing roses at this stock. All 12 analysts covering it rate it a buy, with a median price target of $40.50. That’s 49% upside from current levels, which means even after a 255% run, they think there’s more juice in this squeeze.
Sure, the company posted a $28 million loss last quarter, but that was actually 275% better than the year before. Plus, with a forward P/E of 19 based on next year’s projections, profitability is knocking on the door.
The bottom line
Applied Digital is riding the AI wave like a pro surfer, and this latest financing deal just gave them a bigger board. While a 255% gain might make you think you’ve missed the boat, the analysts seem to think this ship is still setting sail.
Just remember – past performance doesn’t guarantee future results, but sometimes it’s fun to watch a stock absolutely demolish expectations while the rest of us eat our humble pie.