Applied Digital Corp (APLD) stock is soaring 5.17% in pre-market trading on Wednesday, following two significant developments that have boosted investor confidence in the data center operator.

The primary catalyst for the stock's rise appears to be Applied Digital's announcement of a major deal with CoreWeave, a specialized cloud services provider backed by Nvidia. On Monday, the company revealed it had entered into two 15-year leases with CoreWeave, which are expected to generate approximately $7 billion in revenue for Applied Digital over the lease period. This long-term agreement not only provides a substantial and stable revenue stream but also validates Applied Digital's business model and infrastructure capabilities in the growing cloud computing sector.

Adding to the positive sentiment, B. Riley, a financial services firm, has significantly raised its price target for Applied Digital from $8 to $15 while maintaining a Buy rating on the stock. This adjustment reflects growing analyst confidence in the company's prospects, likely influenced by the recent CoreWeave deal. The new price target suggests considerable upside potential from the stock's current trading levels, further fueling investor enthusiasm. With an average Buy rating from analysts polled by FactSet and a mean price target of $14.81, Applied Digital appears well-positioned for continued growth in the eyes of market experts.