AD Should I Buy
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Array Digital Infrastructure Inc (AD) is not a strong buy at the moment for a beginner investor with a long-term strategy. The company's financial performance shows significant challenges, including a sharp decline in net income and EPS, as well as a drastic drop in gross margin. While the technical indicators are neutral to slightly positive, and options data suggests a slightly bullish sentiment, the lack of strong positive catalysts, combined with the upcoming earnings report that is expected to show a significant revenue decline, makes it prudent to wait for more clarity before making a long-term investment.
The MACD histogram is positive at 0.237 and expanding, suggesting a bullish trend. RSI is neutral at 54.144, indicating no overbought or oversold conditions. Moving averages are converging, showing no clear trend. Key support and resistance levels are at S1: 48.381 and R1: 51.407, with the current price near resistance. Overall, the technical indicators are neutral to slightly positive.
The company has taken steps to transform by selling its wireless operations and divesting spectrum, which analysts believe could unlock additional share value. The MACD and options data suggest a slightly bullish sentiment.
The company is expected to report a significant revenue decline of 94.3% year-over-year in its upcoming Q4 earnings. Financial performance in the last quarter showed a sharp drop in net income (-51.40% YoY), EPS (-51.09% YoY), and gross margin (-263.78% YoY). There is no recent congress trading data or strong insider/hedge fund activity to indicate confidence in the stock.
In Q3 2025, revenue increased by 83.06% YoY to $47.12M, but net income dropped significantly to -$38.47M (-51.40% YoY). EPS fell to -0.45 (-51.09% YoY), and gross margin dropped drastically to 30.3 (-263.78% YoY). The company's financials indicate significant challenges, with profitability metrics deteriorating.
Citi analyst Michael Rollins resumed coverage of Array Digital with a Buy rating and a $37 price target, citing positive steps taken by the company to transform its operations. However, this price target is below the current market price, and the analyst sentiment is mixed overall.
