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I previously covered TeraWulf Inc. (WULF) and Core Scientific (CORZ), with this article about Applied Digital (APLD) continuing the theme surrounding power-advantaged data center developers.
Applied Digital: A Meltdown Worth A Buy - Crypto Miner Turned HPC Provider
Summary
- A 15Y take-or-pay contract backlog, expanded opportunities of up to $85.66B, and aggressive power procurements underscore Applied Digital's robust HPC monetization prospects.
- The nascent capacity of 100 MW as of FQ4 '26 and the outsized, multi-year backlog of 1,410 MW by 2028 imply their accelerated growth prospects.
- The recent meltdown has unlocked APLD's cheap FY2029 EV/Sales of 4.75x against the big 5 hyperscalers' median of 6.81x.
- Risks include elevated short interest, negative FCF, rising net debt, and ongoing equity dilution, making it suitable only for long-term, contrarian investors.
- APLD is initiated as a buy here, aided by the oversold technicals and the potential bottoming as per the historical uptrend line.
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Analyst’s Disclosure: I/we have a beneficial long position in the shares of CRWV, AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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