Investors’ insatiable appetite for artificial intelligence (AI) companies remains unyielding as the trading week begins. Applied Digital Corporation (NASDAQ: APLD), a prominent data center operator, experienced a substantial boost in its share price on Monday, thanks to the growing interest in AI and an analyst’s optimistic price target revision.
Craig-Hallum Analyst Upgrades Applied Digital Stock
George Sutton, a respected analyst from Craig-Hallum, raised his price target on Applied Digital stock prior to the market opening on Monday. Sutton increased the target from $13 per share to $15 per share and maintained his buy recommendation for the shares. The analyst was particularly impressed by the company’s sales effectiveness.
In his latest note, Sutton highlighted Applied’s recent achievement in securing two significant deals for its new AI cloud service. These deals amounted to a staggering $180 million over two years and $460 million over three years. Sutton emphasized that Applied Digital is now considered a top-tier player in the market, possessing essential components such as graphics processing units (GPUs), power, and ample space. These factors are in high demand as the AI market continues to flourish.
GPUs, which are advanced processors responsible for handling various complex IT tasks, play a crucial role in AI applications. This aligns perfectly with Applied Digital’s strategic move into the AI cloud computing business, which was launched last month. By venturing into this sector, the company is well-positioned to capitalize on the growing interest in AI technology.
Apart from Sutton’s positive assessment, Applied Digital has a track record of operating effectively in its industry and displaying consistent business growth. The company’s decision to embrace the AI trend is not only encouraging for investors but also executed in a prudent and thoughtful manner.
