Applied Digital Corp. (NASDAQ:APLD) stock surged higher on Wednesday morning following the announcement of a strategic Texas AI data center joint venture and a bullish Wall Street analyst upgrade.
The stock’s advance occurred alongside broader market gains, as the Nasdaq rose 0.52%, the S&P 500 gained 0.02% and the technology sector led all sectors with a 0.8% increase.
On Wednesday, Roth Capital reinstated coverage on Applied Digital stock with a Buy rating and announced a $35 price target.
• Applied Digital stock is among today’s top performers. What’s behind APLD gains?
Strategic Joint Venture In Texas
Soluna Holdings, Inc. (NASDAQ:SLNH) announced Wednesday that it entered into a definitive agreement to form a joint venture entity with Applied Digital. The project company will develop a planned 50 megawatt (MW) critical IT data center for artificial intelligence and high-performance computing at Project Dorothy 3, located near Silverton in Briscoe County, Texas, co-located with the Briscoe Wind Farm. Applied Digital will contribute capital for a 51% controlling interest, while Soluna Holdings contributes land and power-related assets for the remaining 49% stake.
Phase 1 of the Dorothy 3 facility expects to draw power from the 150 MW Briscoe Wind Farm and the local electrical grid. “We have said for a long time that the constraint in AI is energy access, not chips,” said John Belizaire, CEO of Soluna Holdings.
Anchor Tenant Letter Of Intent
ChronoScale Holdings (NASDAQ:CHRN), an accelerated compute platform majority-owned by Applied Digital, signed a non-binding letter of intent for a triple-net lease at the facility. Closing remains subject to tax abatement approvals and definitive agreements, expected by year-end.
Technical Analysis
Even with Wednesday’s bounce, Applied Digital is still trading 12.8% below its 20-day SMA ($23.09) and 36.8% below its 200-day SMA ($31.87), keeping the longer-term trend pointed down. The bearish backdrop is reinforced by the death cross that formed in August (the 50-day SMA below the 200-day SMA), a setup that often acts like overhead "gravity" during rallies.
Applied Digital is hovering near its October swing-low area, making the $19.50 level critical support to watch. Buyers have previously stepped in around this level, but a breakdown could expose the stock to further downside toward its 52-week low of $17.65. Traders will be watching closely to see whether the current rebound holds or gives way to renewed selling pressure.
APLD Stock Price Activity: Applied Digital shares were up 7.40% at $20.77 at the time of publication on Wednesday, according to Benzinga Pro data.
Photo: PJ McDonnell / Shutterstock
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