Applied Optoelectronics (NASDAQ:AAOI) Trading 7% Higher - Here's What Happened

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.

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

Analyst Upgrades and Downgrades

Several analysts have recently commented on AAOI shares. Wall Street Zen downgraded Applied Optoelectronics from a "hold" rating to a "sell" rating in a research note on Saturday, August 9th. Raymond James Financial raised their price objective on shares of Applied Optoelectronics from $18.00 to $25.00 and gave the company an "outperform" rating in a research report on Friday, August 8th. Northland Securities set a $30.00 price objective on shares of Applied Optoelectronics in a research report on Friday, August 8th. Rosenblatt Securities boosted their price objective on shares of Applied Optoelectronics from $30.00 to $34.00 and gave the stock a "buy" rating in a report on Thursday, June 26th. Finally, B. Riley restated a "neutral" rating and set a $15.00 price target (up from $13.00) on shares of Applied Optoelectronics in a research report on Friday, August 8th. Four research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average price target of $27.20.

Applied Optoelectronics Price Performance

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 has a market capitalization of $1.55 billion, a P/E ratio of -7.38 and a beta of 2.72. The firm has a 50-day moving average of $24.65 and a 200-day moving average of $20.19.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last released its quarterly 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 firm had revenue of $102.95 million for the quarter, compared to the consensus estimate of $104.96 million. Applied Optoelectronics had a negative net margin of 42.29% and a negative return on equity of 10.60%. Applied Optoelectronics's quarterly revenue was up 137.9% compared to the same quarter last year. During the same period in the previous year, the company earned ($0.28) earnings per share. Applied Optoelectronics has set its Q3 2025 guidance at -0.100--0.030 EPS. As a group, analysts predict that Applied Optoelectronics, Inc. will post -1.18 EPS for the current year.

Insider Buying and Selling

In related news, Director Min-Chu (Mike) Chen bought 7,500 shares of the company's stock in a transaction that occurred on Wednesday, August 13th. The stock was purchased at an average price of $22.91 per share, for a total transaction of $171,825.00. Following the completion of the transaction, the director owned 22,500 shares in the company, valued at $515,475. The trade was a 50.00% increase in their ownership of the stock. The acquisition was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, CFO Stefan J. Murry sold 12,000 shares of the stock in a transaction on Friday, August 15th. The stock was 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 owned 298,477 shares in the company, valued at approximately $6,676,930.49. The trade was a 3.87% decrease in their position. The disclosure for this sale can be found here. In the last quarter, insiders bought 44,100 shares of company stock worth $1,000,878 and sold 32,784 shares worth $741,217. 4.50% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Applied Optoelectronics

Several hedge funds have recently made changes to their positions in AAOI. SG Americas Securities LLC acquired a new stake in shares of Applied Optoelectronics during the 1st quarter valued at about $370,000. Royce & Associates LP grew its holdings in shares of Applied Optoelectronics by 15.2% during the 1st quarter. Royce & Associates LP now owns 876,543 shares of the semiconductor company's stock worth $13,455,000 after purchasing an additional 115,853 shares during the period. China Universal Asset Management Co. Ltd. raised its stake in shares of Applied Optoelectronics by 31.1% in the 1st quarter. China Universal Asset Management Co. Ltd. now owns 40,000 shares of the semiconductor company's stock valued at $614,000 after acquiring an additional 9,500 shares during the period. Bank of America Corp DE boosted its position in shares of Applied Optoelectronics by 1,058.6% during the fourth quarter. Bank of America Corp DE now owns 339,550 shares of the semiconductor company's stock worth $12,516,000 after buying an additional 310,243 shares during the period. Finally, Assenagon Asset Management S.A. grew its position in Applied Optoelectronics by 182.7% in the 1st quarter. Assenagon Asset Management S.A. now owns 976,520 shares of the semiconductor company's stock valued at $14,990,000 after acquiring an additional 631,128 shares in the last quarter. 61.72% of the stock is owned by institutional investors and hedge funds.

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.