Applied Optoelectronics (NASDAQ:AAOI) Trading 7% Higher - What's Next?

Key Points

• Applied Optoelectronics' shares increased by 7% during Monday trading, reaching a high of $23.18, although the trading volume decreased significantly compared to its average.
• Multiple brokerages have recently evaluated the stock, with Needham & Company LLC setting a price target of $32.00 and Wall Street Zen downgrading it to a "sell" rating; the current consensus rating is "Hold."
• The company's recent earnings report showed a loss of ($0.16) EPS, missing estimates, while revenue increased by 137.9% year-over-year, highlighting both struggles and growth potential.

Shares of Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report) rose 7% during trading on Monday . The company traded as high as $23.18 and last traded at $23.94. Approximately 1,374,858 shares were traded during trading, a decline of 69% from the average daily volume of 4,393,350 shares. The stock had previously closed at $22.37.

Analyst Ratings Changes

Several brokerages recently commented on AAOI. Needham & Company LLC initiated coverage on shares of Applied Optoelectronics in a report on Friday, July 25th. They set a "buy" rating and a $32.00 price target on the stock. Wolfe Research initiated coverage on Applied Optoelectronics in a research note on Tuesday, July 8th. They set a "peer perform" rating for the company. Wall Street Zen lowered Applied Optoelectronics from a "hold" rating to a "sell" rating in a research note on Saturday, August 9th. B. Riley reaffirmed a "neutral" rating and issued a $15.00 price objective (up previously from $13.00) on shares of Applied Optoelectronics in a report on Friday, August 8th. Finally, Northland Securities set a $30.00 target price on shares of Applied Optoelectronics in a report on Friday, August 8th. One investment analyst has rated the stock with a sell rating, two have issued a hold rating and four have given a buy rating to the company's stock. According to MarketBeat.com, the stock currently has a consensus rating of "Hold" and a consensus price target of $27.20.

Applied Optoelectronics Stock Up 16.5%

The company has a debt-to-equity ratio of 0.36, a quick ratio of 1.47 and a current ratio of 2.11. The firm's 50-day moving average price is $23.91 and its two-hundred day moving average price is $20.20. The firm has a market cap of $1.63 billion, a PE ratio of -7.76 and a beta of 2.72.

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). The business had revenue of $102.95 million for the quarter, compared to analyst estimates of $104.96 million. Applied Optoelectronics had a negative return on equity of 10.60% and a negative net margin of 42.29%. Applied Optoelectronics's quarterly revenue was up 137.9% on a year-over-year basis. During the same quarter last year, the company posted ($0.28) EPS. As a group, equities research analysts expect that Applied Optoelectronics, Inc. will post -1.18 EPS for the current fiscal year.

Insider Transactions at Applied Optoelectronics

In other news, CEO Chih-Hsiang (Thompson) Lin acquired 8,850 shares of the business's stock in a transaction on Wednesday, August 13th. The shares were purchased at an average price of $22.53 per share, for a total transaction of $199,390.50. Following the completion of the purchase, the chief executive officer directly owned 1,652,165 shares of the company's stock, valued at $37,223,277.45. This represents a 0.54% increase in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Director Min-Chu (Mike) Chen bought 7,500 shares of the firm's stock in a transaction dated Wednesday, August 13th. The stock was purchased at an average price of $22.91 per share, with a total value of $171,825.00. Following the transaction, the director owned 22,500 shares in the company, valued at approximately $515,475. This represents a 50.00% increase in their position. The disclosure for this purchase can be found here. In the last three months, insiders have bought 44,100 shares of company stock valued at $1,000,878 and have sold 32,784 shares valued at $741,217. Company insiders own 4.50% of the company's stock.

Hedge Funds Weigh In On Applied Optoelectronics

A number of hedge funds have recently added to or reduced their stakes in AAOI. Russell Investments Group Ltd. lifted its position in shares of Applied Optoelectronics by 3,718.6% in the 4th quarter. Russell Investments Group Ltd. now owns 20,964 shares of the semiconductor company's stock worth $773,000 after buying an additional 20,415 shares during the last quarter. Raymond James Financial Inc. acquired a new stake in shares of Applied Optoelectronics during the 4th quarter worth approximately $6,556,000. Sterling Capital Management LLC lifted its holdings in shares of Applied Optoelectronics by 858.2% in the 4th quarter. Sterling Capital Management LLC now owns 1,284 shares of the semiconductor company's stock worth $47,000 after purchasing an additional 1,150 shares during the last quarter. Summit Investment Advisors Inc. boosted its position in Applied Optoelectronics by 17.6% during the 4th quarter. Summit Investment Advisors Inc. now owns 4,262 shares of the semiconductor company's stock valued at $157,000 after purchasing an additional 637 shares during the period. Finally, Barclays PLC increased its position in Applied Optoelectronics by 282.6% in the fourth quarter. Barclays PLC now owns 217,800 shares of the semiconductor company's stock worth $8,027,000 after buying an additional 160,880 shares during the period. Institutional investors and hedge funds own 61.72% of the company's stock.

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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