Applied Digital Corporation — Earnings Quality Grade F
APLD · Technology
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 8 days, change -3 days YoY
AR growth -20.9% vs revenue growth 5.5%
Revenue 5.5%, CFFO -936.6%. Cash follows revenue
Expense Quality
No material inventory
CapEx growth 380.6% is >2x revenue growth 5.5%
SG&A/Gross Profit = 194.3%, exceeds 70%
Gross margin swung +7.7pp (21.9% → 29.6%)
Cash Flow Quality
CFFO < Net Income for 3 consecutive years
FCF is negative ($-0.8B)
Accruals ratio = -6.2%. Low accruals
Cash $0.0B covers only 6% of debt $0.7B
Balance Sheet Health
No goodwill. Clean balance sheet
Interest coverage = -2.7x (<2x). Financial stress
Other assets 5.0% vs revenue 5.5%. Normal
No write-off data
Acquisition Risk
FCF after acquisitions negative for 3 years
No goodwill
Manipulation Score
M-Score = -2.12 (grey zone)
Portfolio monitoring
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Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25