Investing Simplified - Professor G on $APLD (Nov 5, 2026)
The speaker is bullish long term on APLD and is adding to a small high-risk/high-return position, buying drops he views as unjustified; he cites executives' roughly $6.7 million purchase at $18-$19 and rapid revenue/leasing growth, while noting debt and funding needs and that some revenue is construction rather than recurring rent.
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The first number is APLD, a company called "Applied Digital". Its stock has fallen 17% this year and is nearly 59% from its all-time high. Applied Digital builds and leases AI data centers, and its business is growing at an astonishing rate.
Quarterly revenue rose to $341.9 million, more than four times year-over-year. The company has 1.41 gigawatts of leased capacity, representing approximately $36 billion in contract revenue.
There are about 250 megawatts already in operation, with more than 600 megawatts expected to come online during the next year. So, although this sounds very good, why this intense selling?
Debt concerns. Applied Digital has about $6.4 billion in debt against $3.7 billion in cash, including restricted cash, and needs billions more to complete construction. Its exposure to CoreWave and rising borrowing costs have made investors nervous.
In addition, some of the recent revenue has come from construction work rather than recurring rentals. Wall Street remains optimistic with average target prices between $56 and $64, which is nearly three times today's price.
But this is what is most interesting to me, and these are the things I like to find in companies like this, and this is what makes me very optimistic about them in the long run.
The CEO and president recently purchased shares worth approximately $6.7 million of their own money at a price between $18 and $19 per share. So, my decision on this matter is that I am happy to keep what I have, and I have even bought more.
I still buy whenever the drops seem somewhat unjustified. This is part of the higher-risk, higher-return investments in my portfolio, so it is relatively small, but I am adding to it.
So, my decision on this matter is that I am happy to keep what I have, and I have even bought more . I still buy whenever the drops seem somewhat unjustified. This is part of the higher-risk, higher-return investments in my portfolio, so it is relatively small, but I am adding to it.
In addition to Applied Digital and Iran, which are still small. Applied Digital's revenues have more than quadrupled. All three stocks remain well below their high levels. This is the real discount.