Data Center Stocks Continue Downward Trend Amid Capex Fatigue

Shares of former Bitcoin miners IREN (NASDAQ:IREN), TeraWulf (NASDAQ:WULF), and Applied Digital (NASDAQ:APLD) have taken a significant hit over the past month, with each company down more than 30%. IREN stock is trading at $31.67, while TeraWulf shares are down to $16.18 and Applied Digital shares sit at $24.62.

The decline in these stocks reflects a broader re-pricing across AI infrastructure and data center names, driven by capex fatigue, rising financing and credit costs, and a fresh memory and semiconductor rout. The companies' transition from Bitcoin mining to GPU-powered AI and high-performance computing hosting has been the primary driver of their valuations.

IREN's beta figure is 4.28, Applied Digital's is 5.68, and TeraWulf's is 4.26. This sensitivity to market sentiment means that these stocks can move multiples of the overall market when it turns. On valuation, IREN stock trades at a TTM P/E ratio of 39.83x, while TeraWulf and Applied Digital are priced primarily on contracted capacity and forward AI hosting revenue.

The bulls argue that the trailing declines have already reset momentum, but the bears counter that with financing costs climbing and hyperscaler capex under scrutiny, high-beta pivot names like IREN, TeraWulf, and Applied Digital are the first to get sold when the theme wobbles. The DTCR ETF has fared better, down 13% over the past month, due to its diversified infrastructure REITs and semiconductor holdings.