Shares of Applied Digital (NASDAQ: APLD) surged 7.8% on Wednesday, outperforming the S&P 500 and Nasdaq Composite. This increase is attributed to a $40 billion acquisition deal by a group of investors, including BlackRock and Nvidia, for a data center company.

The acquisition of Aligned Data Centers marks the largest deal in the AI data center industry. More investments are expected as the group plans to inject billions into the sector. BlackRock’s CEO sees this move as crucial for supporting future AI infrastructure.

However, Applied Digital faces challenges with a heavy debt load and the need for additional financing. Investors are cautioned about potential risks involved in the company’s expansion plans. Analysts from The Motley Fool did not include Applied Digital in their list of top 10 stocks to buy now.

Read more at Nasdaq: Why Did Applied Digital Stock Jump Today?