Applied Optoelectronics (NASDAQ:AAOI) Shares Gap Down - What's Next?

Key Points

• Applied Optoelectronics shares gapped down from a previous close of $24.20 to open at $22.83, ending the day at $23.29 with over 1 million shares traded.
• The company reported a loss of $0.16 per share for the last quarter, missing analysts' expectations, despite a significant revenue increase of 137.9% compared to the same quarter last year.
• Insider trading activities included increased buying by the CEO, who purchased 3,250 shares, while the CFO sold 12,000 shares, indicating mixed sentiments within the company's leadership.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report)'s stock price gapped down prior to trading on Tuesday . The stock had previously closed at $24.20, but opened at $22.83. Applied Optoelectronics shares last traded at $23.29, with a volume of 1,022,121 shares traded.

Analyst Ratings Changes

Several equities analysts have recently weighed in on AAOI shares. Northland Securities set a $30.00 price objective on Applied Optoelectronics in a research note on Friday, August 8th. Rosenblatt Securities raised their target price on Applied Optoelectronics from $30.00 to $34.00 and gave the company a "buy" rating in a report on Thursday, June 26th. Raymond James Financial raised their target price on Applied Optoelectronics from $18.00 to $25.00 and gave the company an "outperform" rating in a report on Friday, August 8th. Wall Street Zen downgraded Applied Optoelectronics from a "hold" rating to a "sell" rating in a report on Saturday, August 9th. Finally, Wolfe Research initiated coverage on Applied Optoelectronics in a report on Tuesday, July 8th. They set a "peer perform" rating on the stock. Four research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and a consensus price target of $27.20.

Applied Optoelectronics Price Performance

The company has a 50 day moving average of $25.21 and a two-hundred day moving average of $19.93. The firm has a market cap of $1.43 billion, a P/E ratio of -6.78 and a beta of 2.91. The company has a quick ratio of 1.47, a current ratio of 2.11 and a debt-to-equity ratio of 0.36.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last announced its earnings results on Thursday, August 7th. The semiconductor company reported ($0.16) earnings per share for the quarter, missing the consensus estimate of ($0.08) by ($0.08). Applied Optoelectronics had a negative net margin of 42.29% and a negative return on equity of 10.60%. The firm had revenue of $102.95 million for the quarter, compared to the consensus estimate of $104.96 million. During the same period in the prior year, the business earned ($0.28) EPS. The company's quarterly revenue was up 137.9% compared to the same quarter last year. Applied Optoelectronics has set its Q3 2025 guidance at -0.100--0.030 EPS. Sell-side analysts expect that Applied Optoelectronics, Inc. will post -1.18 EPS for the current year.

Insider Buying and Selling at Applied Optoelectronics

In other news, CFO Stefan J. Murry sold 12,000 shares of the company's stock in a transaction on Friday, August 15th. The stock was sold at an average price of $22.37, for a total transaction of $268,440.00. Following the completion of the sale, the chief financial officer directly owned 298,477 shares of the company's stock, valued at $6,676,930.49. This represents a 3.87% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at the SEC website. Also, CEO Chih-Hsiang (Thompson) Lin bought 3,250 shares of Applied Optoelectronics stock in a transaction dated Wednesday, August 13th. The shares were bought at an average cost of $22.65 per share, with a total value of $73,612.50. Following the completion of the acquisition, the chief executive officer owned 1,655,415 shares of the company's stock, valued at $37,495,149.75. The trade was a 0.20% increase in their ownership of the stock. The disclosure for this purchase can be found here. Over the last 90 days, insiders bought 44,100 shares of company stock valued at $1,000,878 and sold 32,784 shares valued at $741,217. 4.50% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Applied Optoelectronics

Hedge funds have recently bought and sold shares of the business. CloudAlpha Capital Management Limited Hong Kong boosted its position in Applied Optoelectronics by 410.7% during the 2nd quarter. CloudAlpha Capital Management Limited Hong Kong now owns 1,408,983 shares of the semiconductor company's stock worth $36,197,000 after acquiring an additional 1,133,115 shares during the period. Nomura Holdings Inc. acquired a new stake in Applied Optoelectronics during the 4th quarter worth about $31,331,000. Jefferies Financial Group Inc. acquired a new stake in Applied Optoelectronics during the 4th quarter worth about $23,354,000. Assenagon Asset Management S.A. boosted its position in Applied Optoelectronics by 182.7% during the 1st quarter. Assenagon Asset Management S.A. now owns 976,520 shares of the semiconductor company's stock worth $14,990,000 after acquiring an additional 631,128 shares during the period. Finally, Alyeska Investment Group L.P. acquired a new stake in Applied Optoelectronics during the 1st quarter worth about $7,455,000. 61.72% of the stock is owned by hedge funds and other institutional investors.

About Applied Optoelectronics

Applied Optoelectronics, Inc designs, manufactures, and sells fiber-optic networking products in the United States, Taiwan, and China. It offers optical modules, optical filters, lasers, laser components, subassemblies, transmitters and transceivers, turn-key equipment, headend, node, distribution equipment, and amplifiers.

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