Applied Digital (NASDAQ: APLD) continued its impressive rally, jumping 6.6% in the morning session, as the stock extended its winning streak to ten consecutive days. This surge has pushed the company’s cumulative return to an astounding 47% over this period, fueled by positive momentum from recent major contracts in the artificial intelligence (AI) infrastructure space.
The latest rally follows significant announcements regarding expanded data center lease agreements with cloud provider CoreWeave. These agreements have increased Applied Digital’s total contracted capacity to 400 megawatts, securing an estimated $11 billion in future lease revenue. This development underscores the company's strategic pivot towards high-performance computing for AI, a rapidly growing market with immense potential.
The broader AI infrastructure sector has also shown robust demand, further boosting investor confidence. Notably, Applied Digital's inclusion in Nvidia's portfolio of AI stock investments has solidified its position as a key player in the space.
Applied Digital's shares have been highly volatile, with 95 moves greater than 5% over the past year. While today's 6.6% jump signals meaningful market reaction to the recent news, it does not fundamentally alter the market's perception of the business. Instead, the stock's momentum appears to be a continuation of the positive sentiment generated by the company's recent lease agreements and the broader strength in the AI infrastructure sector.
Ten days ago, the stock gained 7% following the announcement of a new lease agreement with CoreWeave, which brought Applied Digital's total anticipated contracted lease revenue to approximately $11 billion. This news, coupled with sector-wide optimism, has been a key driver of the stock's recent performance.
Broader AI Infrastructure Trends
The AI and data center market has seen a wave of positive developments, further supporting Applied Digital's growth trajectory. Oracle's blockbuster deal with OpenAI and Super Micro Computer's announcement of shipping products with Nvidia's high-demand Blackwell chips highlight a strong spending environment for AI infrastructure. These trends have bolstered investor confidence in companies like Applied Digital that are strategically positioned to capitalize on the AI boom.
A Record-Breaking Year
Applied Digital's stock has soared 196% since the beginning of the year, recently hitting a new 52-week high at $23.11 per share. For long-term investors, the returns have been extraordinary. A $1,000 investment in Applied Digital five years ago would now be worth an impressive $350,081.
Is Now the Time to Buy?
With its strong momentum, strategic partnerships, and a booming AI infrastructure market, Applied Digital has positioned itself as a leader in the space. However, the stock's volatility and rapid rise warrant careful consideration for potential investors.
For more information on Applied Digital please visit www.applieddigital.com
