Kingsoft Cloud (NASDAQ:KC) & Applied Digital (NASDAQ:APLD) Critical Contrast

Kingsoft Cloud (NASDAQ:KC) and Applied Digital (NASDAQ:APLD) are both mid-cap technology companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.

Analyst Ratings

This is a summary of recent ratings and target prices for Kingsoft Cloud and Applied Digital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kingsoft Cloud	1	0	4	1	2.83
Applied Digital	2	2	12	3	2.84

Kingsoft Cloud presently has a consensus price target of $16.67, indicating a potential upside of 95.39%. Applied Digital has a consensus price target of $62.25, indicating a potential upside of 223.38%. Given Applied Digital’s stronger consensus rating and higher probable upside, analysts clearly believe Applied Digital is more favorable than Kingsoft Cloud.

Valuation and Earnings

This table compares Kingsoft Cloud and Applied Digital”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kingsoft Cloud	$1.37 billion	1.89	-$133.88 million	($0.28)	-30.46
Applied Digital	$611.31 million	9.52	-$244.00 million	($1.64)	-11.74

Kingsoft Cloud has higher revenue and earnings than Applied Digital. Kingsoft Cloud is trading at a lower price-to-earnings ratio than Applied Digital, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Kingsoft Cloud and Applied Digital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kingsoft Cloud	-5.49%	-7.85%	-2.41%
Applied Digital	-51.28%	-27.21%	-5.23%

Institutional & Insider Ownership

13.4% of Kingsoft Cloud shares are owned by institutional investors. Comparatively, 65.7% of Applied Digital shares are owned by institutional investors. 14.2% of Kingsoft Cloud shares are owned by insiders. Comparatively, 9.5% of Applied Digital shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Kingsoft Cloud has a beta of 1.96, meaning that its share price is 96% more volatile than the S&P 500. Comparatively, Applied Digital has a beta of 5.99, meaning that its share price is 499% more volatile than the S&P 500.

About Kingsoft Cloud

Kingsoft Cloud Holdings Limited provides cloud services to businesses and organizations primarily in China. The company's products portfolio includes cloud products, including infrastructure as a service (IaaS) infrastructure, platform as a service (PaaS) middleware, and software as a service (SaaS) applications that primarily consist of cloud computing, network, database, big data, security, storage, and delivery solutions. It offers research and development services, as well as enterprise digital solutions and related services. The company also provides public cloud services to customers in various verticals, including video, e-commerce, intelligent mobility, artificial intelligence, and mobile internet; and enterprise cloud services to customers in financial services, public service, and healthcare businesses. Kingsoft Cloud Holdings Limited was incorporated in 2012 and is headquartered in Beijing, the People's Republic of China.

About Applied Digital

Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.