Key Takeaways
- Applied Digital shares are up 7% today after Roth Capital reinstated coverage with a Buy rating and a $35 price target.
- Roth’s view that the stock has more room to rise than to fall holds up against the stock’s own valuation history.
- Analysts expect revenue to more than triple, from $611 million in fiscal 2026 to $1.95 billion in fiscal 2028.
- The stock trades at about half its three-year average forward price-to-sales multiple, and funding is the main risk to watch.
Applied Digital (APLD) shares are up 7% today after Roth Capital reinstated coverage with a Buy and a $35 target. Analyst Bryan Baratian sees “asymmetric upside” at current valuation levels.
Even after today’s jump to about $21, that target sits nearly 70% above the share price. The stock is still down about 58% from its late-May closing high, despite a 10% bounce on Monday. That rebound came as AI infrastructure stocks recovered from a bruising selloff.
A second firm says the selloff went too far
Roth is the second firm this month to make that case. Needham cut its target to $70 on Oct. 8 but still saw 194% upside.
Baratian argues that Applied Digital has moved from signing leases to delivering capacity. Along with its land and power agreements, Roth says that gives it a “stronger path to scale than the market recognizes.”
Last quarter’s results back up the delivery part. Revenue quadrupled, and President Jason Zhang bought $5.66 million of stock last week. Director Richard Nottenburg sold $682,500, though.
Applied Digital also lined up another site before today’s open. It agreed to form a jointly owned company with Soluna Holdings (SLNH). The venture will develop a planned 50 MW wind-powered AI data center in Texas. Applied Digital will put up the capital for a 51% stake.
Analysts expect revenue to more than triple, from $611 million in fiscal 2026 to $1.95 billion in fiscal 2028…
Today’s news shouldn’t move those estimates much. Roth’s note is a call on valuation, and the Soluna site is still in planning.
TIKR tracks 15 analysts on Applied Digital. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Applied Digital, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Applied Digital’s Analyst Ratings
$35 isn’t much of a stretch
The selloff has left the stock cheap against its own history. It traded at 5.7x forward sales at Tuesday’s close. That’s about half its three-year average of 10.6x, and far off its 33.0x peak in October 2025…
Today’s move only lifts it to around 6x. At $35, it would trade at roughly 10x forward sales on today’s estimates, right about that average.
Roth’s call is also one of the more modest on the Street. The consensus target is $62, down from $77 this summer, while individual targets run from $22 to $93.
That trimmed average still sits at about three times today’s price.
The upside is there, if the capacity shows up
Funding is the risk. CoreWeave (CRWV) shares and bonds slid last week on AI debt fears, rattling the rest of the group. Building AI data centers takes a lot of capital, and IREN slid on funding worries on Tuesday.
My take: Roth’s math works. A return to its usual multiple on today’s estimates gets the stock past $35. And as the forward window rolls toward fiscal 2028’s bigger numbers, $35 needs an even lower multiple. Meanwhile, the Street’s average target sits far above it.
Of course, it all rests on Applied Digital delivering capacity on schedule. The annual meeting comes on Nov. 4, but the fiscal second-quarter report, expected around Jan. 12, is the next check.
So what is Applied Digital stock actually worth?
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