B. Riley Financial Has Lowered Expectations for Applied Optoelectronics (NASDAQ:AAOI) Stock Price

Key Points

• B. Riley Financial cut Applied Optoelectronics’ price target from $109 to $92 and maintained a neutral rating, implying approximately 6.7% upside from the reported share price.
• Analyst sentiment is mixed: the stock carries an overall “Hold” consensus rating with an average price target of $147, while individual targets range from $92 to $220.
• Applied Optoelectronics exceeded quarterly earnings and revenue estimates, with revenue rising 86.3% year over year, but it remains unprofitable; insiders have also sold $6.7 million of shares over the past 90 days.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) had its target price dropped by equities researchers at B. Riley Financial from $109.00 to $92.00 in a research report issued to clients and investors on Thursday, Benzinga reports. The firm currently has a "neutral" rating on the semiconductor company's stock. B. Riley Financial's target price would indicate a potential upside of 6.70% from the stock's current price.

Several other research firms also recently issued reports on AAOI. Needham & Company LLC dropped their target price on Applied Optoelectronics from $220.00 to $190.00 and set a "buy" rating on the stock in a research report on Friday, August 7th. Weiss Ratings cut Applied Optoelectronics from a "sell (d-)" rating to a "sell (e+)" rating in a research report on Monday, August 17th. Wall Street Zen upgraded Applied Optoelectronics from a "sell" rating to a "hold" rating in a research report on Saturday, August 8th. Rosenblatt Securities reiterated a "buy" rating and set a $220.00 price objective on shares of Applied Optoelectronics in a research note on Friday, August 7th. Finally, Raymond James Financial reiterated an "outperform" rating and set a $178.00 price objective on shares of Applied Optoelectronics in a research note on Tuesday, August 11th. Three investment analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat.com, the stock currently has an average rating of "Hold" and a consensus price target of $147.00.

Applied Optoelectronics Price Performance

Shares of NASDAQ:AAOI opened at $86.22 on Thursday. The firm has a market capitalization of $7.29 billion, a PE ratio of -110.54 and a beta of 3.85. The company has a quick ratio of 2.13, a current ratio of 2.78 and a debt-to-equity ratio of 0.12. The company has a 50-day moving average price of $112.40 and a two-hundred day moving average price of $133.41. Applied Optoelectronics has a twelve month low of $18.50 and a twelve month high of $233.67.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last posted its quarterly earnings results on Thursday, August 6th. The semiconductor company reported $0.06 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.02 by $0.04. The company had revenue of $191.92 million for the quarter, compared to analyst estimates of $190.48 million. Applied Optoelectronics had a negative net margin of 9.57% and a negative return on equity of 1.98%. The company's quarterly revenue was up 86.3% compared to the same quarter last year. During the same quarter in the previous year, the firm posted ($0.16) earnings per share. Applied Optoelectronics has set its Q3 2026 guidance at 0.110-0.260 EPS. Equities analysts forecast that Applied Optoelectronics will post 0.55 EPS for the current year.

Insider Activity

In related news, insider Shu-Hua Yeh sold 6,000 shares of the company's stock in a transaction that occurred on Monday, October 5th. The shares were sold at an average price of $120.03, for a total transaction of $720,180.00. Following the sale, the insider owned 371,498 shares of the company's stock, valued at approximately $44,590,904.94. This represents a 1.59% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Stefan J. Murry sold 4,000 shares of the company's stock in a transaction that occurred on Monday, October 12th. The stock was sold at an average price of $102.87, for a total transaction of $411,480.00. Following the sale, the chief financial officer directly owned 363,168 shares in the company, valued at $37,359,092.16. This trade represents a 1.09% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders sold 58,172 shares of company stock worth $6,735,709. 3.80% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Several large investors have recently bought and sold shares of AAOI. BlackRock Inc. bought a new position in shares of Applied Optoelectronics during the 2nd quarter valued at about $955,672,000. William Blair Investment Management LLC purchased a new position in shares of Applied Optoelectronics during the 2nd quarter valued at about $74,703,000. Renaissance Technologies LLC purchased a new position in shares of Applied Optoelectronics during the 1st quarter valued at about $47,817,000. Bank of America Corp DE purchased a new position in shares of Applied Optoelectronics during the 2nd quarter valued at about $33,712,000. Finally, Bank of New York Mellon Corp bought a new stake in Applied Optoelectronics in the 2nd quarter worth approximately $32,567,000. 61.70% of the stock is owned by institutional investors.

Applied Optoelectronics Company Profile

Applied Optoelectronics, Inc NASDAQ: AAOI develops and manufactures fiber-optic networking products used to transmit data across broadband, data center, telecommunications and wireless networks. Its portfolio includes optical transceivers, modules, lasers, components and networking equipment designed for high-speed communications infrastructure.

The company serves communications service providers, cable television and broadband operators, internet content providers, data center operators and telecommunications customers.

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