Applied Digital: Accelerating Hyperscale HPC Growth, Expanding Power Capacity, and Long-Term Contracts Underpin Buy Rating and $40 Target

In a report released today, Kevin Dede from H.C. Wainwright reiterated a Buy rating on Applied Digital Corporation, with a price target of $40.00.

Kevin Dede has given his Buy rating due to a combination of factors that highlight Applied Digital’s accelerating growth and strengthening position in high‑performance computing (HPC) infrastructure. The company nearly doubled sequential revenue in the November quarter, largely driven by the successful delivery and monetization of its first fully energized 100MW building at the Polaris Forge 1 campus for CoreWeave, along with initial lease income from a 15‑year agreement with that customer. Applied has also secured a second major hyperscale client for 200MW at its Harwood campus and is now approved with most of the largest U.S. hyperscalers, underscoring its credibility and relevance in this market. In addition, the firm is actively developing a 900MW project pipeline that, by Dede’s estimates, could translate into roughly $1.5 billion in annualized revenue within about five years, supported by a recent $100 million drawdown from a Macquarie facility that signals confidence in new lease signings.

Dede also points to Applied’s power strategy and execution readiness as key supports for the Buy rating. Through its relationship with Babcock & Wilcox and that company’s new collaboration with Siemens, Applied is positioned to access behind‑the‑meter power from four 300MW gas-fired plants expected to come online around 2028, addressing broader market concerns over power availability. Management has indicated it is prepared to build out multiple facilities at Ellendale and Harwood, and possibly an additional unannounced site, despite tight supply conditions for critical equipment such as transformers and generators, suggesting robust planning and operational capability. With two long‑duration contracts totaling 600MW and approximately $16 billion in contracted revenue, Dede expects ongoing execution to reduce perceived risk, improve borrowing terms, and enhance returns, all of which support reiterating the Buy rating and the $40 price target.

According to TipRanks, Dede is a 4-star analyst with an average return of 8.8% and a 37.78% success rate. Dede covers the Technology sector, focusing on stocks such as Exodus Movement, Inc. Class A, Applied Digital Corporation, and Canaan.

In another report released today, Roth MKM also maintained a Buy rating on the stock with a $58.00 price target.