Applied Digital (APLD) PT Raised to $70 at Compass Point
Compass Point analyst Michael Donovan raised the price target on Applied Digital (NASDAQ: APLD) to $70.00 (from $45.00) while maintaining a Buy rating.
The analyst commented: "Applied Digital announced a 15-year take-or-pay lease after the market close Wednesday for 300MW of critical IT load at Polaris Forge 3 (PF3), its fourth AI Factory campus, with the same U.S.-based high investment-grade hyperscaler that signed Delta Forge 1 (DF1) in April. The deal adds approximately $7.5B of base-term contracted revenue, or $18.2B if all options are exercised, lifting baseline contracted revenue to $31B across four campuses, while contracted critical IT load increased to 1.2GW from 900MW, with approximately 1.67GW of gross utility power now tied to signed leases. We view PF3 as more than another 300MW lease: DF1 brought in a new high-grade hyperscaler, and PF3 shows that customer returned quickly for a second campus, bringing its total commitment to 600MW across DF1 and PF3 and evidence of its trust in Applied’s ability to execute. Applied now has CoreWeave (CRWV) at PF1, Oracle (ORCL) at PF2, and a repeat high investment-grade hyperscaler across DF1 and PF3. The announcement also fits management’s evolving disclosure posture: rather than give investors expected timing for signing leases in a sector that has historically traded around expected contract catalysts, Applied is focused on announcing signed deals when complete instead of telegraphing. Applied’s execution track record, expanding tenant roster, and ability to convert extended pipeline options into marketable capacity give us greater confidence in the platform; we reiterate our Buy rating and raise our price target to $70 from $45."