NEW YORK, January 1, 2026, 06:37 ET — Market closed
Applied Digital (APLD) shares last traded at $24.52, up 1.8% from their previous close, before U.S. markets shut for the New Year’s Day holiday. Shares traded between $23.97 and $25.93 in Wednesday’s session.
The small-cap data-center builder has become a volatile proxy for spending on AI infrastructure, where power availability and access to advanced chips can dictate who gets capacity and when. Investors are focusing on whether Applied Digital can translate that demand into funded projects and recurring cash flow.
Applied Digital said on Dec. 29 it entered a non-binding term sheet — a preliminary outline of a deal — to spin out its Applied Digital Cloud business and combine it with Nasdaq-listed Ekso Bionics to form ChronoScale. Applied Digital would own about 97% of the combined company, which the firms expect to close in the first half of 2026, subject to approvals. The company said the cloud unit deployed Nvidia’s H100 graphics processing units (GPUs) at scale in 2023 and generated about $75.2 million in revenue in the 12 months ended Aug. 31, 2025. 1
Northland named Applied Digital its “Top Pick for 2026” and kept an Outperform rating with a $40 price target. The firm pointed to demand for power from hyperscalers — large cloud companies that buy data-center capacity in huge blocks — and to Applied Digital’s execution and development pipeline, alongside a medium-term REIT plan. A real estate investment trust (REIT) is a tax-advantaged structure often used to hold income-producing property. 2
Lake Street analyst Rob Brown reiterated a Buy rating and raised his target to $45, saying a spin-out could help surface the value of the cloud GPU operation. He called it “largely a forgotten asset within Applied” and said the business is operating six GPU clusters and generating about $75 million in annual revenue. 3
Citizens also kept an Outperform rating and $40 target, saying the deal sharpens focus on high-performance computing data-center development while creating a dedicated platform for accelerated compute. The broker said it could help improve equity returns in the core colocation business, where customers rent space, power and cooling. 4
With the stock around $24.50, the $40–$45 targets imply roughly 60%–80% upside, but the market is still pricing in meaningful execution risk. The key question is whether the proposed split makes the story simpler — or adds a second track of approvals, financing and timelines to manage.
Northland’s REIT framing would put Applied Digital closer to established data-center landlords such as Digital Realty and Equinix, which also use the structure. Bulls argue that separating long-lived real estate assets from faster-growing compute services can change how investors model cash flow and risk.
Before the next session, traders will watch for any new details on the ChronoScale timeline and financing, especially steps toward definitive documents and the shareholder votes required to close. Any update on customer demand would also matter in a market where power and delivery schedules are tight.
Applied Digital is scheduled to report results for the quarter ended Nov. 30 after the market closes on Jan. 7, followed by a conference call at 5 p.m. ET, the company said. Guidance on capital needs, buildout milestones and demand signals is likely to shape positioning into that print. 5
Technically, the late-December area around $24 has been acting as a near-term reference point, with highs near $26 as the next hurdle. A decisive break either way could amplify moves in a stock that has tended to trade with wide daily ranges.
