Applied Digital Stock Drop Looks Sharp, But How Deep Can It Go?
Applied Digital (APLD) stock is down 17.5% in a day. The recent slide reflects renewed concerns around high valuations in AI infrastructure and profit-taking after a sharp rally, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?
Before judging its downturn reslience, let’s look at where Applied Digital stands today.
- Size: Applied Digital is a $5.9 Bil company with $148 Mil in revenue currently trading at $22.98.
- Fundamentals: Last 12 month revenue growth of 9.3% and operating margin of -31.3%.
- Liquidity: Has Debt to Equity ratio of 0.12 and Cash to Assets ratio of 0.03
- Valuation: Applied Digital stock is currently trading at P/E multiple of -24.1 and P/EBIT multiple of -34.8
- Has returned (median) 68.4% within a year following sharp dips since 2010. See APLD Dip Buy Analysis.
These metrics point to a Moderate operational performance, alongside Very High valuation – making the stock Unattractive. For details, see Buy or Sell APLD Stock
That brings us to the key consideration for investors worried about this fall: how resilient is APLD stock if markets turn south? This is where our downturn resilience framework comes in. Suppose APLD stock falls another 20-30% to $16 – can investors comfortably hold on? Turns out, the stock has fared worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
- The Forces Behind PayPal’s 50% Stock Drop
- Is Boston Scientific’s Bull Thesis Still Intact?
- How Micron Stock Surges To $700
- AMD Stock Crash Is A Golden Money Making Opportunity
- This Strategy Pays You 12% While Lining Up STX at Bargain Prices
- The Next Big Rally in Micron Technology Stock Could Start Like This
2022 Inflation Shock
- APLD stock fell 82.6% from a high of $5.06 on 26 October 2021 to $0.88 on 13 July 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 16 May 2023
- Since then, the stock increased to a high of $37.76 on 15 October 2025 , and currently trades at $22.98
| APLD | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -82.6% | -25.4% |
| Time to Full Recovery | 307 days | 464 days |
2020 Covid Pandemic
- APLD stock fell 67.6% from a high of $0.03 on 9 July 2020 to $0.01 on 29 July 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 3 December 2020
| APLD | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -67.6% | -33.9% |
| Time to Full Recovery | 127 days | 148 days |
2018 Correction
- APLD stock fell 89.8% from a high of $0.05 on 1 June 2018 to $0.01 on 29 October 2019 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 14 December 2020
| APLD | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -89.8% | -19.8% |
| Time to Full Recovery | 412 days | 120 days |
2008 Global Financial Crisis
- APLD stock fell 91.7% from a high of $0.12 on 10 November 2008 to $0.01 on 11 December 2008 vs. a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 29 July 2009
| APLD | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -91.7% | -56.8% |
| Time to Full Recovery | 230 days | 1480 days |
Feeling jittery about APLD stock? Consider portfolio approach.
Portfolios Over Individual Stock Picks
Individual stocks are unpredictable. A smart portfolio keeps you invested, limits downside shocks, and provides upside exposure
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.