Craig-Hallum Nearly Doubles Price Target on Applied Digital (APLD), Reiterates Buy

Applied Digital Corporation (NASDAQ:APLD) is one of the best data center stocks to buy now. The stock has surged 114% year-to-date, fueled by accelerating demand for artificial intelligence (AI) and high-performance computing (HPC). This demand has elevated APLD’s position in the data center space and kept investor attention firmly on its growth pipeline.

That story gained an extra push on August 18, when the company unveiled plans for a $3 billion, 280-megawatt (MW) AI Factory near Harwood, North Dakota. The project, called Polaris Forge 2, will break ground in September 2025, with the first capacity expected in 2026 and full operations in early 2027. The announcement triggered a 16% rally in the stock by the end of the trading day.

Applied Digital (NASDAQ:APLD) already operates data centers in Jamestown and Ellendale, North Dakota, providing roughly 286 MW of hosting capacity. In addition, Polaris Forge 1, a 400 MW HPC campus, remains under construction and is scheduled to go live in 2025. Together, these projects significantly expand the company’s scale in an industry seeing rapid capital inflows.

Reflecting this momentum, George Sutton, an analyst from Craig-Hallum, raised his price target to $23 from $12 while keeping a Buy rating. In the note published on August 18, the analyst noted that private-market deals in the data center sector are being struck at multiples and capitalization rates that imply more upside for Applied Digital (NASDAQ:APLD) than current trading levels suggest. In his view, the market has yet to fully price in the company’s project pipeline or the valuation benchmarks set by comparable transactions.

It is worth noting that the stock carries a beta of roughly 6.0, highlighting its high volatility. Investors may want to carefully weigh this risk before making any investment decision.

Applied Digital Corporation (NASDAQ:APLD) develops and operates digital infrastructure solutions and cloud services tailored to the HPC and AI markets across North America.

While we acknowledge the potential of APLD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.