Applied Digital Valuation
| APLD Stock | USD 34.98 -1.37 -3.77% |
Below Model Estimate
Today
Right now, the market is showing Low price fluctuation for Applied Digital. Our intrinsic value estimate for Applied Digital is anchored to a 3 months horizon. Negative margins (-101.0%) signal that the market sees earnings risk not yet reflected in the model's forward assumptions. Lengthening the time horizon typically improves pricing accuracy.
Value Estimates Divergence
At $34.98, Applied Digital trades at a distance from a model-derived intrinsic value estimate of $39.58 per share, reading as below model estimate. For Applied Digital, the key valuation inputs are current valuation of $11.09B and a profit margin of -1.01%, with an added check on Probability Of Bankruptcy.| Historical | Market 34.98 | Intrinsic 39.58 | Target 52.18 | Sentiment 34.65 | Naive 38.17 |
The intrinsic value of Applied Digital estimates Applied Digital's true worth by discounting projected cash flows to present value. Intrinsic value becomes more actionable when compared against the range of analyst estimates and peer multiples. The intrinsic value provides a target price range anchored in business fundamentals. Financial performance, growth prospects, and competitive position together determine Applied Digital's intrinsic value.
Measuring the upside and downside potential of Applied Digital gives a realistic sense of possible returns. The upside and downside range for Applied stock incorporates both fundamental trajectory and market sentiment. The practical value of this range is in identifying whether the current price already reflects the bear case or leaves downside unpriced. These boundaries shift as new earnings data, guidance, and macro conditions are absorbed into the model.
The valuation of Applied Digital depends on whether margins, cash generation, and capital structure support current pricing. Comparing multiple valuation approaches and benchmarking against peers establishes whether current pricing aligns with Applied Digital's earnings profile and risk structure. A valuation rooted in multiple frameworks is less likely to overweight a single assumption about Applied Digital's future trajectory. Benchmarking against peers produces the most actionable estimate of Applied Digital's value.
Main Profitability Drivers
On a profitability basis, Applied Digital carries a -101.00% net margin and a -32.00% operating margin. Non-operating charges narrow Applied Digital's margins by roughly 69.00 percentage points between the operating and net income lines. From 215.51 Million in revenue, Applied Digital retained 144.98 Million after cost of goods and reported -231.06 Million in net income. With ROE at -44.00% and ROA at -15.00%, these return measures help contextualize Applied Digital's profitability relative to its balance sheet. Applied Digital faces challenges on the profitability front, with declining trends across multiple margin and return indicators. A more granular view is available in Applied Digital's profitability metrics for a broader perspective on earnings quality.
Price Book 6.3218 | Gross Profit | Price Sales 31.3104 | Profit Margin | Enterprise Value Revenue 34.7466 |
Applied Digital Cash | 137.56 Million |
Cash stood at 131.01 Million as of December 31, 2025.
Applied Digital is a software company generating revenue through recurring subscriptions, enterprise contracts, and platform usage, which directly shapes its valuation profile and margin structure. Trading as a turnaround stock in Software, negative margins indicate the investment case rests on restoring operational profitability. Below, the key valuation drivers are examined to determine what the market is pricing and whether the underlying data supports it.
Total Value Analysis
The market-value snapshot for Applied Digital reflects enterprise value of 11.09 B, market capitalization of 10 B, debt of 702.88 M, and cash and equivalents of 40.83 M as of latest reporting. Reviewing Applied Digital fundamentals clarifies whether the enterprise-value composition reflects durable capital structure or temporary balance-sheet effects.| Takeover Price | Market Cap | Debt Obligations | Cash & Equivalents |
11.09 B | 10 B | 702.88 M | 40.83 M |
Investor Information
About 66.0% of APLD shares are held by institutions such as insurance companies. APLD has Price/Earnings To Growth (PEG) ratio of 1.83. APLD reported a loss per share of 0.38. APLD had not issued any dividends in recent years. The firm completed a 0.166-for-1 stock split on 13th of April 2022. Current financial indicators suggest pressured financial positioning in asset utilization and capital deployment. Asset returns have turned negative, signaling headwinds in Current operating cycle.Asset Utilization
The concept of asset utilization usually refers to the revenue earned for every dollar of assets a company currently reports. The latest return on assets of Applied indicates not a very effective usage of assets in April.Macro event markers
Discounted Cash Flow Analysis
Applied Digital trades above its custom levered DCF estimate, with implied equity value per share of -12.48 versus a market price of 34.98. Relative to the modeled value, the stock sits roughly 135.7% higher. The setup uses a WACC of 35.13% and a long-term growth rate of 2.0%, with next-period free cash flow around -1.34 Billion. Terminal value still drives about 46.7% of enterprise value. while net debt stands around 588.96 Million. Divergences of this magnitude warrant particular scrutiny of the underlying assumptions. The market may be pricing in risks or structural headwinds that the model's base case does not fully capture.Model Value / Share
-12.48
Equity value per share from the current custom levered DCF summary row.
Market Price
34.98
Current market price used by the same scenario.
Model Premium
135.7%
Market price sits above the model output.
WACC / LT Growth
35.13% / 2.0%
Forecast horizon: 2021 to 2030Terminal value share of EV: 46.7%
Applied Market Price vs. Intrinsic Value
This chart compares observed market pricing with the model-derived equity value per share across forecast periods. It also illustrates the relative premium or discount, expressed as a percentage difference between market valuation and modeled intrinsic value.
Projected Revenue and Levered Free Cash Flow
Revenue and levered free cash flow projections are presented in billions, outlining the expected financial trajectory over the modeled horizon.
Key Model Assumptions
The inputs below reflect the core assumptions applied in the valuation model, including growth expectations, discount rates, and capital structure considerations.
| Input | Current Value |
|---|---|
| Weighted Average Cost of Capital | 35.13% |
| Long-Term Growth Rate | 2.0% |
| Cost of Equity | 38.25% |
| After-Tax Cost of Debt | 3.92% |
| Debt Weighting | 9.08% |
| Equity Weighting | 90.92% |
| Net Debt | 588.96 Million |
| Enterprise Value | -1.92 Billion |
| Present Terminal Value | -897.91 Million |
| Terminal Value Share of EV | 46.7% |
Forecast Detail and Valuation Progression
This table presents the underlying forecast data used in the valuation, including revenue, cash flow generation, discounting effects, and the resulting per-share value across each projected period.
| Year | Revenue | Revenue Growth | Free Cash Flow | PV of LFCF | Equity Value / Share |
|---|---|---|---|---|---|
| 2021 | 0.0 | 0.00% | -3.38 Million | 0.0 | -12.48 |
| 2022 | 8.55 Million | 0.00% | -55.85 Million | 0.0 | -12.48 |
| 2023 | 55.39 Million | 547.94% | -72.54 Million | 0.0 | -12.48 |
| 2024 | 136.62 Million | 146.64% | -128.01 Million | 0.0 | -12.48 |
| 2025 | 215.51 Million | 57.74% | -797 Million | 0.0 | -12.48 |
| 2026 | 354.37 Million | 64.44% | -179.77 Million | -133.03 Million | -12.48 |
| 2027 | 582.71 Million | 64.44% | -295.61 Million | -161.88 Million | -12.48 |
| 2028 | 958.18 Million | 64.44% | -486.09 Million | -196.98 Million | -12.48 |
| 2029 | 1.58 Billion | 64.44% | -799.31 Million | -239.7 Million | -12.48 |
| 2030 | 2.59 Billion | 64.44% | -1.31 Billion | -291.67 Million | -12.48 |
Profitability Analysis
An analysis of Applied Digital's profitability data, Applied Digital is currently operating at a loss, with net income of -231.06 Million. The net profit margin is -101.0% and operating margin is -32.0%, with return on equity at -44.0%. Profitability is deteriorating broadly, with margin and return metrics declining across multiple levels of the income statement.Net Loss | First Reported 2001-08-31 | Previous Quarter -17.5 M | Current Value -99.3 M | Quarterly Volatility 26.5 M |
Macro event markers
Profitability for Applied Digital depends on margin structure, capital efficiency, and cost control. Both net and operating margins are negative (-101.0% and -32.0% respectively), indicating the business is consuming more capital than it generates at current revenue levels. The breakdown below connects margin levels with asset efficiency and capital returns. Applied Digital reports return on equity of -44.0%, reflecting negative returns on shareholder capital.
Earnings per Share Projection vs Actual
Comparing Applied Digital's estimated and trailing EPS clarifies whether the earnings trajectory is accelerating or decelerating. Forward EPS of -0.1454 compared to trailing -0.38 signals the expected earnings direction for Applied. Margin trends and working capital shifts add nuance to Applied Digital's reported EPS. Estimate dispersion for Applied reflects the degree of uncertainty embedded in current analyst models. Projected earnings per share for Applied Digital anchor the market's pricing of near-term earnings power. Consensus estimates may not capture non-recurring items or stock-compensation effects, so testing against the current net margin profile (-101.0%), guidance revisions, and prior forecast error adds precision. Applied Digital reported estimated earnings of -0.14535 in earnings per share on 31st of May 2026. This estimate serves as the benchmark against which the next reported result will be judged by the market.Macro event markers
Earnings Estimation Breakdown
11 analysts contribute to the current consensus. The last reported EPS was 0.09 as of 28th of February 2026.
Last Reported EPS
-0.1675
Lowest
-0.1454
Expected EPS
-0.09
Highest
Analyst estimate range around the current expected EPS projection.
Earnings Projection Consensus
| Number of Analysts | Historical Accuracy | Last Reported EPS | Estimated EPS for 31st of May 2026 | Current EPS (TTM) | |
| 11 | 29.86% | 0.09 | -0.1454 | -0.38 |
Ownership Allocation
Over half of Applied Digital's outstanding shares are owned by institutional holders. This level of institutional participation often indicates steady inclusion in actively managed funds and index-tracking vehicles, driven by Applied Digital's size, liquidity, and analyst coverage.Revenue and Profit Overview
APLD reported previous year's revenue of 215.51 M. Net Loss for the year was -231.06 M with profit before overhead, payroll, taxes, and interest of 144.98 M.Interpreting Recent Signals
With margins currently negative, Applied Digital is consuming more capital than it generates. For enterprise software providers built on its enterprise subscription and cloud software model, this directly limits how much weight traditional valuation multiples can carry. Applied Digital carries minimal debt at 0.28, more financial cushion than many comparable companies - relevant during periods of heightened market volatility.
Overall Interpretation
Across the key valuation dimensions, Applied Digital presents a business currently operating below profitability breakeven, where operating costs tied to the underlying business model outpace revenue within Software. Negative margins are the dominant signal - the business is consuming more capital than it generates, making traditional valuation multiples unreliable. For enterprise software providers, this is a direct consequence of the underlying cost structure and the sensitivity of profitability to volume and pricing. The data points to a business where current multiples are less informative because underlying profitability has not been established. A re-rating depends on cloud adoption trajectory, recurring revenue growth, and margin expansion from operating leverage at scale.
Each of the valuation dimensions above captures a different angle on Applied Digital, and their combined signal matters more than any single metric. With margins currently negative, the critical question is whether the path to profitability is supported by revenue trends and cost discipline.
Valuation Framework, Methodology & Assumptions
Applied Digital is a mid-cap equity in Application Software, Information Technology Services, Information Technology categories. Capital structure affects intrinsic modeling assumptions. On a relative-multiples basis, Applied Digital is priced at P/S of 31.31.
Applied Digital analytics rely on periodic company reporting and market reference feeds, with quality checks and normalization applied. Analyst inputs may be included when coverage is available. Valuation outputs are model-derived and depend on published assumptions and reference inputs.
The analysis above is generated by quantitative models and is provided for informational and educational purposes only. It does not constitute financial advice, investment recommendations, or an endorsement to buy or sell any security. All investing involves risk, including the possible loss of principal. Consult a qualified financial advisor before making investment decisions. See our Terms of Use for full details.
Financial data referenced in this analysis is derived from publicly available SEC filings, audited financial statements, and third-party market data providers. The intrinsic value estimate is generated by Macroaxis quantitative models that incorporate fundamental analysis, technical indicators, and risk metrics.
The methodology combines multiple analytical inputs:
- Fundamental analysis - financial statements, profitability ratios, debt structure, and cash flow metrics sourced from SEC filings and public financial reports
- Technical indicators - historical price patterns, momentum signals, and volatility measures
- Risk assessment - probability of bankruptcy models, market risk metrics, and downside scenario analysis
- Peer comparison - relative valuation against industry peers using standardized multiples
Model outputs are refreshed periodically as new financial data becomes available. Past model performance is not indicative of future results. The intrinsic value estimate reflects a point-in-time calculation and should be considered alongside other research and professional advice.
Data sourced from SEC filings (EDGAR), public financial statements, and market data providers.
Editorial review and methodology oversight provided by: Gabriel Shpitalnik, Member of Macroaxis Editorial Board
Growth Indicators
Reviewing growth indicators for Applied Digital is especially important when the thesis depends on margin repair or cyclical recovery rather than already-established compounding. A disciplined review here compares growth rates with margin repair, leverage, and execution quality before treating the setup as a durable expansion story.
| Common Stock Shares Outstanding | 201.2 M | |
| Forward Price Earnings | 526.3158 |
Applied Digital Current Valuation Indicators
Valuation of Applied Digital is strongest when several lenses are used together: market cap, enterprise value. revenue, and cash-flow durability. The business currently sits in the Financial Services sector and the Capital Markets industry. Current pricing suggests the market is discounting specific expectations about growth trajectory, margin stability, and capital allocation. Reported values are derived from company filings, audited financial statements, and market data, and are standardized within Macroaxis quantitative models for consistency. Model outputs reflect a point-in-time estimate based on available data and assumptions and should be interpreted alongside changes in operating performance, market conditions, and forward expectations.