Prediction: This Data Center Stock Will Keep Sliding in 2027

Applied Digital (NASDAQ:APLD) shares have lost about 30% since 2026 began, even as the S&P 500 (SNPINDEX:^GSPC) gained 12%, and the Nasdaq Composite (NASDAQINDEX:^IXIC) added 10%. Still, it's up by about 250% over the last three years -- not bad. While the company had its beginnings in the crypto mining space, it found massive success after a pivot to running data centers for artificial intelligence (AI), and now has $36 billion in revenue lined up if it can deliver on its promises.

But most of the data center capacity it has leased out is still under construction; there's no guarantee that it will come online on time and on budget. Here's why I think 2027 will see Applied Digital stock trading lower than it is today.

You can think of Applied Digital as a sort of specialized developer and landlord. The company finds land, secures access to enough power, builds a data center, and then rents it out to a tenant. It doesn't actually fill the data center with the GPUs that power AI. That's the tenant's responsibility.

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