What Is The Case For Waiting On Applied Digital Stock

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Applied Digital (APLD) stock closed at $19.33 on October 20, 2026, sitting 61.1% below the highest close of the past year it reached in May. Investors paying that price get a company that builds data centers for AI customers while still reporting a loss during construction. So should you buy at $19.33 now, or wait for the January report?

What Are You Paying For Applied Digital Now?

Investors are paying about a quarter of the sales multiple from a year ago. Applied Digital lost money over the last twelve months, so its price-to-earnings ratio is meaningless, leaving price against sales as the measure. Shares traded at 8.3 times sales at the end of September, compared with 26.6 a year earlier. By the October 20 close, they cost 6.6 times sales.

The business under that multiple has improved. The company narrowed its operating loss to 28.6% of revenue over the same twelve months, down from 37.6% a year before. Operations also brought in $235 million of cash, compared with $121 million going out a year earlier, even while the company kept reporting a loss. Even so, the multiple is not low by the stock's own standards: it was lower at 23 of the 34 quarter ends on record, measured against the end-of-September multiple of 8.3.

Buyers appear to be paying for contracts. Management says Applied Digital has about $36 billion in contracted revenue across five campuses, and the company targets take-or-pay leases of at least 15 years with investment-grade hyperscalers.

The Revenue Applied Digital Is Expected To Report Next

Analysts expect revenue of about $191 million for fiscal Q2 2027. That represents a little more than half of the $342 million Applied Digital reported for fiscal Q1 2027.

Most of that recently reported revenue was not rent. The HPC hosting business brought in $262.6 million, but base rent accounted for only $65.8 million of it. Another $183.5 million came from tenant fit-out services.

Management focuses its own forecasts on capacity. The company expects to place over 600 megawatts into service over the next 12 months, compared with 250 megawatts over the past 12. The stock price appears to assume this new capacity turns into rent.

When Does Applied Digital Report Next?

Applied Digital is expected to report its results for fiscal Q2 2027, the three months to November, on or around January 5, 2027. Past earnings reports have often moved the stock hard in both directions. Shares fell 12.0% over the two trading days following the July 2026 report, but rose 27.5% over the same span following the January 2026 report. The October 2026 report barely moved them, a 0.5% dip.

The stock has also fallen hard during broader market sell-offs. It dropped 65% from its peak during the 2025 US Tariff Shock, compared with a 19% decline for the S&P 500.

Management expects 300 megawatts of critical IT to come online across North Dakota by the end of this calendar year. By then, the company also expects to sign about 250 megawatts of expansion leases at materially higher pricing than earlier leases. If those leases are signed by December, waiting for the January report means buying after the news becomes public. If those leases remain unsigned when Applied Digital reports in January, buying today would have been early.

How To Act On APLD?

Not necessarily on Applied Digital alone, if your goal is long-term wealth. Wealth is built by owning the companies that keep outperforming, the leaders of their industries, wherever they are. Applied Digital is one. Over the five years to October 2026, its stock rose 438%, ahead of 24 of the 27 other companies in IT Consulting & Other Services, where the typical company fell 18.9%.

Finding companies like these takes comparison across industries and sectors, and that is what the Trefis High Quality (HQ) Portfolio does. It holds 30 quality companies in equal weight and, since its inception in September 2020, has returned more than 105%, ahead of a benchmark that combines the S&P 500, S&P Mid-cap and Russell 2000. See how we find the leaders.

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