AI data center stocks got hammered last week. CoreWeave fell about 25%. The cost of insuring its debt against default, through credit default swaps, climbed past 11% a year. Its bonds sold off until they yielded close to 15%. A hot inflation report raised the odds of another rate hike, and the companies that borrow to build data centers took the worst of it.
While that was happening, two executives at Applied Digital (APLD) were buying. Applied Digital builds AI data centers in North Dakota and leases them to tenants that include CoreWeave. On Friday, the day the stock fell 11.5%, President Jason Zhang bought 300,000 shares at $18.86, about $5.7M. CEO and Chairman Wes Cummins bought 55,803 shares at $18.04, a penny under the close. It's his first open-market buy since 2023.
The stock finished the week at $18.05, down 24%. Two of the people with the best view of Applied Digital's tenants and its debt put $6.7M into it on the worst day of the selloff.