Shares of Applied Digital Corp. (NASDAQ:APLD) are trading higher Thursday afternoon as a broader equity market rebound propelled AI infrastructure and digital hosting providers.
The afternoon strength was catalyzed by a major sell-side endorsement published on Thursday from Wells Fargo, which designated APLD as a “Top Idea” and initiated coverage with a $50 price target.
- Applied Digital shares are climbing with conviction. What’s driving APLD stock higher?
Wells Fargo Initiates Coverage with Overweight Rating and $50 Target
In the note, Wells Fargo emphasized Applied Digital’s structural competitive advantages in securing utility power allocations and multi-gigawatt site interconnects required for high-density AI workloads, specifically pointing to the lower relative regulatory risk associated with its power-advantaged footprint.
Furthermore, the initiation highlighted the quality of APLD’s investment-grade-concentrated backlog, which features $36 billion in long-term, take-or-pay lease agreements with top-tier hyperscalers that could reach up to $86 billion over 30 years if renewal options are exercised.
Wells Fargo noted that APLD trades at a material discount to its contracted net asset value and multi-year revenue visibility. In fact, the analysts estimate that this contracted book alone is worth approximately $30 per share on a net present value basis, providing a strong near-term re-rating opportunity for the stock.
APLD Stock Climbs Thursday Afternoon
APLD Price Action: Applied Digital shares were up 7.46% at $26.21 at the time of publication on Thursday, according to Benzinga Pro data.
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