Applied Digital (APLD) Surges 13.76% on $2.35B Funding and AI Infrastructure Momentum – What’s Next for the Tech Stock?

Summary
• APLD’s stock price rockets to $27.19, up 13.76% intraday, breaking above its 52-week high of $40.20
• Recent news includes a $2.35B senior secured notes offering and a $5B AI factory lease with a U.S. hyperscaler
• Options volume spikes, with 215,296 contracts traded as of 17:34 ET

Applied Digital’s stock is experiencing a dramatic intraday rally, driven by a series of capital-raising milestones and AI infrastructure progress. The company’s recent $2.35B notes offering and a $5B AI factory lease with a U.S. hyperscaler have ignited investor optimism. With the stock trading near its 52-week high, the question now is whether this momentum can sustain or if it’s a short-term spike.

Capital Inflows and AI Infrastructure Catalysts Fuel APLD’s Surge
Applied Digital’s 13.76% intraday jump is directly tied to its recent $2.35B senior secured notes offering and a $5B AI factory lease with a U.S. hyperscaler at Polaris Forge 2. These developments signal robust capital deployment for AI infrastructure expansion, aligning with the sector’s demand for high-performance computing (HPC) and GPU-driven workloads. Additionally, the company’s $787.5M draw from Macquarie Asset Management and the completion of Phase II at Polaris Forge 1 further validate its execution on AI factory buildouts, attracting speculative and institutional buying.

Information Technology Services Sector Rally as APLD Outpaces AMZN
The Information Technology Services sector is in a broad uptrend, with Amazon.com (AMZN) rising 0.8379% intraday. APLD’s 13.76% surge far outpaces AMZN’s modest gains, reflecting speculative fervor around AI infrastructure plays. While AMZN’s growth is driven by cloud services, APLD’s focus on AI factory leasing and HPC hosting positions it as a niche beneficiary of the AI infrastructure boom, attracting investors seeking high-conviction plays in the sector.

Options and ETF Strategy for APLD’s Volatile AI Infrastructure Play
• 200-day average: 15.827 (well below current price)
• RSI: 42.45 (neutral, suggesting potential for further upside)
• MACD: -0.808 (bearish), Signal Line: -0.148 (bearish), Histogram: -0.660 (bearish divergence)
• Bollinger Bands: Price at 26.88 (middle band), near upper band at 34.60

APLD’s technicals present a mixed picture. While the RSI suggests neutrality, the MACD and Bollinger Bands hint at short-term volatility. Key levels to watch include the 200-day average at $15.83 (strong support) and the upper Bollinger Band at $34.60 (resistance). The stock’s 13.76% intraday gain suggests a continuation of bullish momentum, but the bearish MACD warns of potential pullbacks. For leveraged exposure, consider XLF (Financial Select Sector SPDR ETF) if the broader market aligns with APLD’s AI infrastructure narrative.

Top Options Picks:
1. APLD20251226C27
• Type: Call
• Strike Price: $27
• Expiration: 2025-12-26
• IV: 84.38% (high volatility)
• Leverage Ratio: 17.96%
• Delta: 0.5628 (moderate sensitivity)
• Theta: -0.1553 (rapid time decay)
• Gamma: 0.1155 (high sensitivity to price changes)
• Turnover: 208,718 (high liquidity)
• Payoff (5% upside): $0.45 per share
• Why: High gamma and moderate delta make this call ideal for a continuation of APLD’s rally. The high turnover ensures liquidity, and the 17.96% leverage ratio amplifies gains if the stock breaks above $27.

2. APLD20251226C27.5
• Type: Call
• Strike Price: $27.5
• Expiration: 2025-12-26
• IV: 88.21% (very high volatility)
• Leverage Ratio: 20.37%
• Delta: 0.5065 (moderate sensitivity)
• Theta: -0.1532 (rapid time decay)
• Gamma: 0.1119 (high sensitivity to price changes)
• Turnover: 91,966 (high liquidity)
• Payoff (5% upside): $0.20 per share
• Why: The 20.37% leverage ratio and high gamma make this contract a high-reward play if APLD sustains its momentum. The 88.21% IV reflects strong market expectations, and the moderate delta balances risk and reward.

Action Insight: Aggressive bulls should consider APLD20251226C27 into a breakout above $27.50, while conservative traders may use APLD20251226C27.5 as a directional bet on AI infrastructure demand.

Backtest Applied Digital Stock Performance
The backtest of APDL's performance after a 14% intraday surge from 2022 to now shows favorable results. The 3-Day win rate is 53.33%, the 10-Day win rate is 55.33%, and the 30-Day win rate is 56.22%, indicating a higher probability of positive returns in the short term. The maximum return during the backtest was 33.94% over 30 days, suggesting that APDL can deliver significant gains even after the initial surge.

APLD’s AI Infrastructure Momentum: A High-Volatility Trade with Clear Catalysts
Applied Digital’s 13.76% intraday surge is a direct result of its $2.35B capital raise and AI factory leasing progress, positioning it as a key player in the HPC and AI infrastructure boom. While technicals suggest short-term volatility, the stock’s alignment with AI demand and its aggressive capital deployment make it a compelling high-conviction trade. Investors should monitor the $27.50 resistance level and the 200-day average at $15.83 as critical support. For context, Amazon.com (AMZN) is up 0.8379% today, underscoring the sector’s broader strength. Act now: Buy APLD20251226C27 if the stock breaks above $27.50, or short-term traders can scalp the move with APLD20251226C27.5.