Is It Too Late to Buy Applied Digital (APLD) Stock?

Key Points
Applied Digital has been growing like gangbusters.
Among other things, the company is building data centers that facilitate artificial intelligence (AI).
Its stock isn't cheap, though.
- 10 stocks we like better than Applied Digital ›
Applied Digital (NASDAQ: APLD) has been quite a hot stock lately, nearly quadrupling in value (up 286%) over the past year, as of March 23. Over the past decade, it has averaged annual gains of 77% -- much of that thanks to the past year's meteoric rise, of course.
You may be wishing you had invested in it a decade ago and wondering whether it's too late to jump in now. Here are some thoughts.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
For starters, know that Applied Digital designs, develops, and operates digital infrastructure solutions and cloud services for high-performance computing (HPC) and artificial intelligence (AI) industries. Among other things, it's involved in designing and building data centers and in offering infrastructure services for crypto miners. In other words, it's heavily involved in a lot of fast-growing areas.
In order to do all that, the company has been investing significant sums in its own infrastructure. The company recently sported a market value of around $7.5 billion (as of March 24), and it's planning to borrow around $2.15 billion to build out its Polaris Forge 2 AI campus.
Check out its last earnings report, and you'll be pleased to see revenue up 250% in the second quarter, to $126.6 million, but also a net loss of $31.2 million (smaller than the year-earlier loss). Meanwhile, it also carried $2.6 billion in long-term debt.
My colleague Leo Sun, while suggesting that Applied Digital is still a buy at recent levels, noted: "Last December, it announced it would spin off its cloud computing business and merge it with EKSO Bionics Holdings to create a new company called ChronoScale. That divestment, which hasn't yet closed, will throttle near-term revenue growth but stabilize margins."
I, too, would love to be a shareholder, but so far I'm holding off due to valuation concerns and also because the company has been posting losses instead of gains for some time now. The stock could keep surging from here, but there's no margin of safety. And there are plenty of other exciting growth stocks out there.
Should you buy stock in Applied Digital right now?
Before you buy stock in Applied Digital, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Applied Digital wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $497,659!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,095,404!*
Now, it’s worth noting Stock Advisor’s total average return is 912% — a market-crushing outperformance compared to 185% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of March 26, 2026.
Selena Maranjian has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.