Alright, so here’s the scoop on Applied Digital (or as the cool kids say, Nasdaq: APLD). Back in December, it felt like this AI data center company was surfing on some AI wave, right? People were hyped, the stock was up over 350% in less than a year — wild times. But, fast-forward to now and, well, things are… let’s say, a bit wobbly.
So, here’s the deal: these guys build and run these high-tech data centers, perfect for all your AI and high-performance computing dreams. They’re like the backbone, kinda like the unsung hero, behind today’s AI explosion. Also, they do this cloud thing for AI and machine learning, but… let’s not get too deep into that.
But hold on, it seems like the fairy tale has hit a rough patch. Their stock was riding high above $13 but now it’s back to around $10. Why? Well, let’s just say the financial fairies aren’t as magical as they seemed.
There’s this chart (imagine it right here) showing the ups and downs. Anyway — wait, looking at their last quarter, revenue did jump 22% to $52.9 million. Sounds good, right? Until you see they still lost $36.1 million. Ouch.
And cash flow? Oh man, it’s like watching water flow out of a bucket with a giant hole. They’ve been burning cash like it’s going out of style – four quarters straight! Which, when you think about it, is kinda concerning given their big plans to grow.
But hey, they’re not just sitting around. They’ve snagged $375 million from Sumitomo Mitsui Banking and talked up a $5 billion potential deal with Macquarie. That’s big money, showing why they need so much cash to grow.
They’re also thinking of ditching their Cloud Services Biz to focus on their data centers. Might make sense, but it’s like chopping off a limb that grew 220% last year. Is it a smart move? Guess we’ll find out.
Now, this Value Meter thing? Says their enterprise value-to-net asset value ratio is 7.77 — which sounds like a discount compared to the average 12.37 in the biz. So, maybe a steal, right?
But wait, here’s a snag: they’ve got that wicked cash flow problem, averaging -64.05% of net assets over four quarters. It’s slightly “better” than others with -69.87%, sure. But it’s like saying getting hit by a smaller truck is better than a big one. Still hurts.
In simple terms, it’s like every quarter, they burn through more than half their assets. Okay, even with new funds, this isn’t exactly sustainable. Their AI gamble could still roll the right way, but right now? Their price tag’s a bit too bold for comfort.
Until this digital drama squares away cash flow woes, maybe holding back isn’t the worst idea?
Yup, Value Meter says, “Extremely Overvalued.” And there’s another chart here, but, you know, numbers and lines.
So, folks, what do you want me to value next? Drop those ticker symbols in the comments!
And that’s a wrap on whether this AI stock’s fairytale is hitting a plot twist.
