Applied Optoelectronics (NASDAQ:AAOI) Stock Price Down 4.6% - Should You Sell?

Key Points

• Applied Optoelectronics' stock price declined by 4.6% to $29.15, with trading volume down 45% from the average daily volume.
• Analyst ratings are mixed, with four analysts rating the stock as a Buy, two as Hold, and the current consensus target price is $27.20.
• The company reported a significant quarterly loss, with an EPS of ($0.16), missing estimates, despite revenue showing a 137.9% year-over-year increase.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report)'s stock price was down 4.6% on Tuesday . The stock traded as low as $28.84 and last traded at $29.15. Approximately 2,483,736 shares were traded during trading, a decline of 45% from the average daily volume of 4,521,917 shares. The stock had previously closed at $30.54.

Analyst Upgrades and Downgrades

Several equities analysts have weighed in on AAOI shares. Wolfe Research initiated coverage on shares of Applied Optoelectronics in a report on Tuesday, July 8th. They set a "peer perform" rating for the company. Wall Street Zen cut shares of Applied Optoelectronics from a "hold" rating to a "sell" rating in a research report on Saturday, August 9th. Rosenblatt Securities upped their target price on shares of Applied Optoelectronics from $30.00 to $34.00 and gave the company a "buy" rating in a research note on Thursday, June 26th. Northland Securities set a $30.00 price target on shares of Applied Optoelectronics in a report on Friday, August 8th. Finally, B. Riley reissued a "neutral" rating and set a $15.00 target price (up from $13.00) on shares of Applied Optoelectronics in a report on Friday, August 8th. Four analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and a consensus target price of $27.20.

Applied Optoelectronics Stock Down 8.1%

The stock's 50-day moving average is $25.07 and its 200-day moving average is $20.34. The stock has a market cap of $1.75 billion, a P/E ratio of -8.35 and a beta of 2.91. The company has a current ratio of 2.11, a quick ratio of 1.47 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 (EPS) for the quarter, missing analysts' consensus estimates 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 company had revenue of $102.95 million during the quarter, compared to the consensus estimate of $104.96 million. During the same quarter in the prior year, the company earned ($0.28) EPS. The business's quarterly revenue was up 137.9% on a year-over-year basis. Applied Optoelectronics has set its Q3 2025 guidance at -0.100--0.030 EPS. As a group, research analysts anticipate that Applied Optoelectronics, Inc. will post -1.18 earnings per share for the current fiscal year.

Insider Activity at Applied Optoelectronics

In other news, CFO Stefan J. Murry sold 12,000 shares of the stock in a transaction that occurred on Friday, August 15th. The shares were sold at an average price of $22.37, for a total value 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 transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, Director William H. Yeh purchased 4,000 shares of Applied Optoelectronics stock in a transaction dated Thursday, August 14th. The stock was bought at an average cost of $21.40 per share, with a total value of $85,600.00. Following the completion of the transaction, the director directly owned 253,819 shares of the company's stock, valued at $5,431,726.60. This represents a 1.60% increase in their ownership of the stock. The disclosure for this purchase can be found here. In the last ninety days, insiders bought 44,100 shares of company stock valued at $1,000,878 and sold 30,784 shares valued at $709,117. Corporate insiders own 4.50% of the company's stock.

Hedge Funds Weigh In On Applied Optoelectronics

Hedge funds have recently added to or reduced their stakes in the company. Nisa Investment Advisors LLC increased its holdings in Applied Optoelectronics by 497.5% in the second quarter. Nisa Investment Advisors LLC now owns 962 shares of the semiconductor company's stock worth $25,000 after buying an additional 801 shares during the last quarter. GAMMA Investing LLC increased its holdings in Applied Optoelectronics by 85.9% in the second quarter. GAMMA Investing LLC now owns 1,785 shares of the semiconductor company's stock worth $46,000 after buying an additional 825 shares during the last quarter. Pinpoint Asset Management Singapore Pte. Ltd. acquired a new position in Applied Optoelectronics in the second quarter worth approximately $49,000. CWM LLC increased its holdings in Applied Optoelectronics by 175.5% in the second quarter. CWM LLC now owns 2,218 shares of the semiconductor company's stock worth $57,000 after buying an additional 1,413 shares during the last quarter. Finally, Headlands Technologies LLC acquired a new position in Applied Optoelectronics in the second quarter worth approximately $57,000. Institutional investors and hedge funds own 61.72% of the company's stock.

Applied Optoelectronics Company Profile

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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