Applied Digital (APLD) is a high-growth U.S. company that has transformed from a Bitcoin mining hosting business into an AI data center leasing provider. Based on a long-term lease agreement worth approximately 16.973 trillion won with Coreweave, it has entered the 12-month baseline target price range of $60 and a Buy rating, but it is a stock accompanied by extreme volatility with a beta of 5.6.
Analysis date 2026-06-26 · Applied exchange rate 1 USD = 1,543 KRW (as of 2026-06-25) · Current price 1 TP4T40.95 (approx. 63,186 KRW). All KRW conversions in the text were calculated using this single exchange rate.
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- Key Summary of Applied Digital (APLD) Stock Price Outlook
- What kind of company is Applied Digital (APLD)?
- Key Terms You Need to Know Before Applied Digital Analytics
- Applied Digital Recent Quarterly Earnings Analysis
- Applied Digital Fair Value Analysis (DCF/Multiple)
- Applied Digital vs. Competitor Comparison
- Applied Digital Growth Outlook and Key Drivers
- Applied Digital 12-Month Target Price Scenario
- Applied Digital Recent Major Issues
- Key Risks in Applied Digital Investment
- Applied Digital Investment Opinion Conclusion
- 5 Frequently Asked Questions about Applied Digital APLD
Key Summary of Applied Digital (APLD) Stock Price Outlook
The 12-month baseline target price for Applied Digital (APLD) is $60 (approx. 92,580 won).
The investment recommendation is Buy (medium confidence).
The key basis is the revenue visibility derived from the 15-year long-term lease agreement worth approximately 16.973 trillion won signed with Coreweave.
The current price of 40.95 (approx. 63,186 KRW) is located near the upper end of the 52-week range of 9.02 (approx. 13,918 KRW) to 50.725 (approx. 78,269 KRW). Over the past year, the stock price has risen by approximately +2,941 TP3T.
There are three key investment points. First, the transition of the business model from a Bitcoin mining hosting company to an AI data center leasing provider for hyperscalers has been virtually completed. Second, the company has secured a multi-year contract revenue backlog through the CoreWeave (400MW) and Polaris Forge 2 (approximately 7.715 trillion KRW) contracts. Third, the consensus is "Strong Buy," with an average target price of $73.36 and a median of $79 from 11 Wall Street institutions.
However, the deficit on a GAAP basis, a debt ratio of 1,101 TP3T, a high short selling volume of 29.31 TP3T relative to outstanding shares, and extreme volatility with a beta of 5.6 are clear risk factors.
What kind of company is Applied Digital (APLD)?
Applied Digital Corporation is a digital infrastructure company based in Dallas, Texas, USA, which changed its name to its current name in November 2022. It designs, builds, and operates data center infrastructure for the high-performance computing (HPC) and artificial intelligence (AI) industries.
The business is broadly divided into two segments. Data Center Hosting is a traditional business that provides infrastructure to cryptocurrency mining customers, while HPC Hosting is a new growth business that leases data centers for AI and machine learning to hyperscalers on a long-term basis. As of the third quarter of fiscal year 2026, HPC Hosting revenue stood at $71M (approximately 109.6 billion KRW), and its share is rapidly increasing.
The core assets are the Polaris Forge campus series and the Delta Forge campus currently under construction in North Dakota. The company spun off and sold its GPU Cloud Services business and simplified its business model to become a real estate leasing (REIT-like) data center operator.
The revenue model is a 10 to 15-year long-term lease agreement with hyperscalers. It is a structure where a building (data center) is constructed and leased out entirely along with power and cooling infrastructure, and a fixed rent is received for the duration of the contract. The biggest competitors are Core Scientific (CORZ) and IREN, which are following a similar transition path, as well as Coreweave (CRWV) and Nevius (NBIS) from the NeoCloud camp.
Key Terms You Need to Know Before Applied Digital Analytics
- HPC (High-Performance Computing)High-performance computing. It is a computing infrastructure that processes tasks requiring massive computation, such as AI training and inference, and is a core growth area for Applied Digital.
- Hyperscaler: Cloud providers that operate massive data centers, such as Microsoft, Meta, and Coreweave. They are Applied Digital's core leasing customer base.
- Neocloud: An emerging group of cloud companies that lease AI computing by securing large-scale NVIDIA GPU infrastructure. Coreweave, Navius, and Airen are representative examples, and Applied Digital leases data centers to them.
- MW / Critical IT Load: A unit of power representing data center capacity. 1 MW is equivalent to the power of approximately 1,000 households and is a key indicator in determining the scale and price of data center lease contracts.
- RFS (Ready for Service): Service Ready. This refers to the state where the data center building is powered and ready for actual operation by customers, and rental revenue is recognized from this point onward.
- Contracted Revenue Backlog: Revenue confirmed to be recognized in the future from long-term contracts already concluded. Applied Digital’s Coreweave contract backlog is approximately 16.973 trillion won.
Applied Digital Recent Quarterly Earnings Analysis
Applied Digital's fiscal year ends in late May. Recent quarterly revenue trends show a steep upward trajectory.
| Quarter (Fiscal Year) | Sales (USD) | Sales (KRW) | note |
|---|---|---|---|
| FY26 Q1 (2025-08) | $64.2M | Approximately 99.1 billion won | — |
| FY26 Q2 (2025-11) | $126.6M | Approximately 195.3 billion won | QoQ approx. +97% |
| FY26 Q3 (2026-02) | $126.6M | Approximately 195.4 billion won | YoY +139% |
The most recently announced results for the third quarter of fiscal year 2026 (ended February 31, 2026) significantly exceeded market expectations. Revenue surged by 1391% year-over-year to 126.6 million USD.
On a GAAP basis, the company recorded a net loss of -$0.36 (approx. -555 won) per share, but this reflects one-time expenses such as losses from the sale of tangible assets. Adjusted EPS was $0.09 (approx. 139 won), delivering an 'earnings surprise' that exceeded the market estimate of -$0.17 by approximately 1,53%.
Profitability indicators also improved. Adjusted EBITDA was recorded at $44.1M (approx. 68 billion KRW), and adjusted net profit was $33.2M (approx. 51.2 billion KRW). For detailed items, Q3 earnings press release released by the company's IRYou can check it at.
In terms of financial soundness, the situation presents mixed results. While cash holdings are ample at 1.73 billion (approximately 2.6694 trillion won), total liabilities amount to 2.83 billion (approximately 4.3667 trillion won), resulting in a debt-to-equity (D/E) ratio of approximately 1101. The current ratio is 2.38 times, indicating sound short-term liquidity. However, free cash flow (FCF) is recording a significant negative figure every quarter due to ongoing large-scale data center construction (CapEx).
Applied Digital Fair Value Analysis (DCF/Multiple)
As Applied Digital is a loss-making company under GAAP, traditional P/E multiples are meaningless. The trailing price-to-sales ratio (P/S) is approximately 36.6 times, and the price-to-book ratio (P/B) is approximately 7.39 times (Net Asset Value per Share: 1 TP 4 T 5.54, approximately 8,550 KRW), which are very high in absolute terms. In other words, the current stock price reflects a 'future contract backlog' rather than 'current earnings.'.
Therefore, it is reasonable to approach the fair value of the stock using a DCF based on future rental cash flows. The key assumptions are as follows.
| DCF assumption items | Usage value | reason |
|---|---|---|
| Discount rate (WACC) | 12% | Reflecting a high-risk, high-debt structure with a beta of 5.6 |
| End-of-life value growth rate (g) | 3.0% | Long-term data center demand + inflation |
| forecast period | 5 years | Contract Backlog Visibility Section |
| Base FCF conversion | Gradual increase in EBITDA margin of contract revenue | Cash out when rented building RFS is reached |
| Bull FCF assumption | Base × 1.4 | 1GW Expansion and Additional Lease Signed |
| Bear FCF assumption | Base × 0.7 | Construction Delays and AI Capex Slowdown |
Assuming that the contract backlog (Coreweave approx. 16.973 trillion KRW + Polaris Forge 2 approx. 7.715 trillion KRW) converts into high-margin lease EBITDA upon reaching RFS, the fair value range of the DCF is approximately $52~$72 It is calculated at a level. The reason it is presented as a range rather than a single value is due to the significant variability caused by construction schedules and financing costs.
Wall Street analysts' views are more aggressive than this analysis. The average target price from 11 institutions is $73.36, with a median of $79; in June, Northland ($82), Needham ($83), Lakestreet ($90), and Craig-Hallam ($79) raised their target prices. Taken together, Applied Digital exhibits a dual nature: "overvalued based on current multiples, but fair to undervalued based on future backlogs.".
Applied Digital vs. Competitor Comparison
| item | Applied Digital (APLD) | Core Scientific (CORZ) | IREN | Nevius (NBIS) |
|---|---|---|---|---|
| Market capitalization | Approx. $11.7B | Approximately $6B (estimated) | Approx. $18B (estimated) | Approx. $23B |
| TTM Revenue (USD) | Approx. $319M | n/a | n/a | Approx. $530M |
| Sales Growth Rate (YoY) | +139% | high growth | high growth | +three-digit number |
| Business Model | Data center lease (landlord) | Mining → AI/HPC Transition | Mining + AI Cloud (In-house Operation) | AI Cloud (In-house Operation) |
| Key differentiators | Coreweave 400MW Long-term Lease Backlog | Coreweave acquisition negotiation history | MS $9.7B contract · Profit | Meta Backlog · Abundant Capital |
The biggest difference is that Applied Digital focuses on the role of a data center 'building owner,' unlike NeoCloud (CoreWeave and Navius), which operates GPUs directly. This structure has the advantage of low risk of GPU price fluctuations and fixed rental fees. Following the same mining-to-AI transition path Core Scientific (CORZ), a beneficiary of the transition to AI and HPC data centersDirectly comparable to, and a core customer of Applied Digital AI Cloud Leader Coreweave (CRWV)It shares the same fate as the facility investment cycle.
On the other hand, operating its own AI cloud AI Cloud Emerging Powerhouse Nevius (NBIS)[Company Name] possesses higher revenue potential and abundant capital, but also has significant operational complexity. It can be summarized that Applied Digital has the advantage in revenue visibility (long-term contracts) and model simplicity, but is at a disadvantage in terms of capital strength and the timing of turning a profit.
Applied Digital Growth Outlook and Key Drivers
The core engine of growth is the realization of the contract backlog. A long-term lease agreement was signed with Coreweave for a total of 400 MW at the Polaris Forge 1 Campus, worth approximately 16.973 trillion won (including an initial 15-year contract worth approximately 10.801 trillion won). The first 100 MW building reached RFS in the fourth quarter of 2025, and the second 150 MW building is targeted for operation in mid-2026.
The second pillar is Polaris Forge 2. The company signed a lease agreement for an 'AI Factory' worth approximately 7.715 trillion won with a U.S. investment-grade hyperscaler and issued 6.751 TP3T senior secured bonds worth 1 TP4T 2.15B (approx. 3.3175 trillion won) to finance the construction of a 200MW facility. When combined with the groundbreaking of Delta Forge 1 (430MW) and the power contract for Polaris Forge 3 (targeted for 2027), the total capacity being pursued by the company exceeds 1GW.
The basis for the growth rate assumptions is as follows: historical revenue growth (YoY +1391 TP3T) was derived from quarterly data, analyst consensus (strong future growth) from reports from 11 institutions, and industry growth from forecasts on AI data center power demand. However, a more important variable than the absolute growth rate is the 'speed at which contract revenue is converted into actual lease EBITDA,' which depends on the building's RFS attainment schedule.
Applied Digital 12-Month Target Price Scenario
| scenario | Target Price (USD) | Target Price (KRW) | Compared to the current price | Probability |
|---|---|---|---|---|
| Bull | $90 | Approximately 138,870 won | +120% | 25% |
| Base | $60 | Approximately 92,580 won | +47% | 50% |
| Bear | $30 | Approximately 46,290 won | -27% | 25% |
The base scenario target price is $60 (approximately 92,580 won). This assumes that the Coreweave and Polaris Forge 2 contracts reach RFS on schedule and lease EBITDA begins in earnest.
The bullish scenario is $90 (approx. 138,870 KRW). This occurs when 1GW expansion accelerates, additional hyperscaler leases are signed, and the target price level suggested by Lakestreet is reached.
The bearish scenario is $30 (approximately 46,290 won). It reflects a combination of construction delays, rising financing costs, a slowdown in the AI capital investment cycle, or stock dilution resulting from a large-scale capital increase.
The rationale for setting the scenario probabilities at 50/25/25 is as follows. Although revenue visibility is clearly high due to the multi-year long-term contract with Coreweave, a balanced allocation was adopted because the extreme volatility of Beta 5.6 and debt and dilution risks leave significant room for both bullish and bearish sentiments. The weighted expected return is approximately +46.51 TP3T, which significantly exceeds the Buy baseline (+151 TP3T).
For reference, the primary goal of this analysis is $60. Wall Street consensus target priceIt is more conservative than (average $73, median $79). This is because it reflects execution and financing risks more significantly.
Applied Digital Recent Major Issues
- $1.59B Bond Issuance Completed (2026-06-18): Issued 7.01 TP3T senior secured bonds worth 1 TP4T 1.59B (approx. 2.4534 trillion KRW) (maturity in 2031) to fund the 150MW expansion of Polaris Forge 1.
- Coreweave 150MW Additional Lease ConfirmedThe total capacity of Polaris Forge 1 has been increased to 400 MW, expanding the contract backlog to approximately 16.973 trillion won.
- Polaris Forge 3 Power Contract: Signed a power supply contract with Montana-Dakota Utility and aims to begin operations in 2027.
- Analyst Target Price Upward March (June)A series of upgrades followed, including Craig-Hallam $79, Needham $83, Northland $82, and Lake Street $90.
The imminent catalysts are the earnings announcement for the fourth quarter of fiscal year 2026 (ended in late May) and whether Polaris Forge Phase 1 & 2 buildings (150 MW) meet RFS requirements. These two factors mark the turning point that will confirm a full-scale, stepwise increase in rental revenue. In terms of AI data center power infrastructure, AI data center power beneficiary TALEN Energy (TLN)It is also necessary to check the supply and demand of the entire power supply chain.
Key Risks in Applied Digital Investment
1. Customer Concentration Risk The majority of revenue is concentrated on a single customer, Coreweave. If Coreweave slows its capital expenditures or credit issues arise, Applied Digital's revenue visibility will take a direct hit. → Monitoring indicators: Coreweave quarterly capex guidance and announcement of new customer diversification.
2. Financing and Debt Risk The construction of data centers requires massive capital, resulting in a debt-to-equity ratio of 1,101 TP3T, and bond yields (6.75–7.01 TP3T) are also burdensome. Construction financing costs surge in the event of rising interest rates or a tightening of the capital market. → Monitoring indicators: New bond issuance rates, interest coverage ratio, and FCF deficit.
3. Stock dilution risk → The company has repeatedly issued paid-in capital increases and convertible bonds to raise funds. If additional capital increases continue, the value per share will be diluted. → Monitoring indicators: Quarterly change in the number of outstanding shares, outstanding balance of preferred shares and convertible securities.
4. Valuation and Volatility Risk → With a P/S of 36.6x and a beta of 5.6, the decline during an AI theme correction could exceed five times the market average. The high short selling balance of 29.31 TP3T relative to outstanding shares further amplifies short-term volatility. → Monitoring indicators: Trend in short selling balance, AI data center sector fund flow.
5. Construction and Execution Risks → Rental revenue is recognized only when the building reaches the RFS. Revenue recognition is delayed if there are delays in power connection, material or personnel bottlenecks, or regulatory approvals. → Monitoring Indicator: Achievement of RFS schedule by campus.
Applied Digital Investment Opinion Conclusion
The investment rating for Applied Digital (APLD) is Buy. The confidence level is Medium, and the investment period is based on 12 months.
The CoreWeave contract backlog amounting to approximately 16.973 trillion won and the additional Polaris Forge 2 contract (approx. 7.715 trillion won) provide a level of revenue visibility rarely seen in other AI infrastructure stocks. The weighted expected return of +46.51 TP3T is attractive.
However, this stock is not suitable for conservative investors. Given the extreme volatility of a beta of 5.6, the GAAP deficit, and high debt and dilution risks, it is advisable to keep the weight in the portfolio small within the limits of high-risk growth stocks and approach it through staggered buying. The key is to monitor Coreweave's capital investment momentum and campus-specific RFS schedules quarterly.
5 Frequently Asked Questions about Applied Digital APLD
Q1. What is the 12-month target price for Applied Digital (APLD)?
Based on the base scenario, the target is $60 (approx. 92,580 KRW), with a bullish range of $90 (approx. 138,870 KRW) and a bearish range of $30 (approx. 46,290 KRW). The weighted expected return is approximately +46.5%, placing it in the Buy zone. The average Wall Street target is higher at $73.
Q2. Why is Applied Digital classified as a beneficiary of the AI data center market?
This is because the company transitioned its business from Bitcoin mining hosting to AI and HPC data center leasing. It signed a long-term contract worth 400 MW and approximately 16.973 trillion won with Coreweave, and secured an additional contract worth approximately 7.715 trillion won with an investment-grade hyperscaler at Polaris Forge 2.
Q3. Is Applied Digital's current stock price overvalued or undervalued?
Based on current earnings, it is overvalued. With a P/S of approximately 36.6x and a P/B of approximately 7.39x, the absolute levels are high. However, the fair value based on future lease cash flows (DCF) is approximately $52 to $72, so there is room to view the current price as fair to undervalued once the contract backlog is realized.
Q4. Which is more attractive, Applied Digital or Core Scientific (CORZ)?
Both are stocks transitioning from mining to AI data centers. Applied Digital has clearer revenue visibility due to its long-term CoreWeave 400MW backlog, while Core Scientific has a relatively lower valuation burden due to its smaller market capitalization. If you prioritize revenue visibility, choose Applied Digital; if you prioritize valuation, choose Core Scientific.
Q5. What is the biggest risk when investing in Applied Digital?
The risks are Coreweave's concentration on a single client and financing and equity dilution risks. A debt ratio of 1,101 TP3T, a beta of 5.6, and short selling volume of 29.31 TP3T increase volatility. Coreweave's capex guidance, new bond yields, quarterly share issuance volume, and campus-specific RFS schedules should be monitored.
Sources
- Applied Digital — Q3 Fiscal Year 2026 Earnings Press Release (Company Investor Relations)
- Applied Digital — Additional 150MW Coreweave Lease Confirmed (Company IR)
- APLD Analyst Target Price Consensus (TipRanks)
This analysis is intended for informational purposes only and does not constitute investment advice. The final decision and responsibility for all investment decisions rest solely with the investor. Exchange rates and stock prices are based on the time of writing and fluctuate in real time.
※ This analysis utilized AI tools during the writing process, and the final content has been verified by the author. It is for informational purposes only, and investment decisions and responsibilities lie solely with the investor.