Analyst John Todaro from Needham maintained a Buy rating on Applied Digital Corporation (APLD – Research Report) and keeping the price target at $10.00.
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John Todaro has given his Buy rating due to a combination of factors that he believes have been misunderstood by the market. He suggests that the recent stock movement following the earnings report was an overreaction, as the only new developments were the potential signing of a lease by a non-major hyperscaler and the formal announcement to sell the Cloud Segment.
Todaro notes that investor sentiment turned negative mainly due to expectations regarding high-performance computing and the lack of detailed information on the lease timeline. He also highlights key areas of investor focus, such as the comparison between Powered Shell and Full Stack builds, as well as concerns about liquidity and capital expenditure moving forward.
In another report released on April 15, Craig-Hallum also maintained a Buy rating on the stock with a $10.00 price target.