Applied Optoelectronics (NASDAQ:AAOI) Trading Down 4.8% - What's Next?

Key Points

• Applied Optoelectronics' stock price fell by 4.8% to $26.40, with a substantial decline in trading volume, dipping 65% from its average sessions.
• The company missed earnings expectations, reporting a loss of ($0.16) EPS compared to the consensus estimate of ($0.08) EPS, despite a 137.9% year-over-year revenue increase.
• Analysts' opinions are mixed, with a consensus rating of "Moderate Buy" and an average target price of $27.20, while some firms have recently downgraded their ratings.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report)'s share price traded down 4.8% during mid-day trading on Thursday . The stock traded as low as $26.89 and last traded at $26.40. 1,561,737 shares changed hands during mid-day trading, a decline of 65% from the average session volume of 4,474,236 shares. The stock had previously closed at $27.72.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently weighed in on the stock. Northland Securities set a $30.00 price target on shares of Applied Optoelectronics in a report on Friday, August 8th. Raymond James Financial increased their price objective on shares of Applied Optoelectronics from $18.00 to $25.00 and gave the company an "outperform" rating in a research note on Friday, August 8th. Rosenblatt Securities increased their price objective 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. Wall Street Zen downgraded shares of Applied Optoelectronics from a "hold" rating to a "sell" rating in a research note on Saturday, August 9th. Finally, Needham & Company LLC started coverage on shares of Applied Optoelectronics in a research note on Friday, July 25th. They set a "buy" rating and a $32.00 price objective on the stock. Four analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the stock. According to data from MarketBeat, the stock has a consensus rating of "Moderate Buy" and an average target price of $27.20.

Applied Optoelectronics Stock Performance

The stock has a market capitalization of $1.67 billion, a P/E ratio of -7.94 and a beta of 2.91. The company's 50-day moving average is $24.96 and its two-hundred day moving average is $19.89. 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 quarterly earnings data on Thursday, August 7th. The semiconductor company reported ($0.16) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.08) by ($0.08). Applied Optoelectronics had a negative return on equity of 10.60% and a negative net margin of 42.29%.The business had revenue of $102.95 million during the quarter, compared to analyst estimates of $104.96 million. During the same period in the prior year, the firm earned ($0.28) EPS. The business's revenue for the quarter 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, sell-side analysts anticipate that Applied Optoelectronics, Inc. will post -1.18 EPS for the current fiscal year.

Insider Buying and Selling

In related news, insider Hung-Lun (Fred) Chang sold 15,784 shares of the business's stock in a transaction on Wednesday, August 13th. The shares were sold at an average price of $22.70, for a total transaction of $358,296.80. Following the transaction, the insider owned 256,326 shares of the company's stock, valued at approximately $5,818,600.20. The trade was a 5.80% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, CEO Chih-Hsiang (Thompson) Lin bought 8,850 shares of the company's stock in a transaction that occurred on Wednesday, August 13th. The shares were bought at an average cost of $22.53 per share, for a total transaction of $199,390.50. Following the transaction, the chief executive officer directly owned 1,652,165 shares of the company's stock, valued at $37,223,277.45. This trade represents a 0.54% increase in their position. The disclosure for this purchase can be found here. Over the last 90 days, insiders have purchased 44,100 shares of company stock valued at $1,000,878 and have sold 32,784 shares valued at $741,217. 4.50% of the stock is owned by company insiders.

Institutional Investors Weigh In On Applied Optoelectronics

Institutional investors and hedge funds have recently bought and sold shares of the business. Nisa Investment Advisors LLC increased its holdings in Applied Optoelectronics by 497.5% in the 2nd quarter. Nisa Investment Advisors LLC now owns 962 shares of the semiconductor company's stock valued at $25,000 after buying an additional 801 shares during the period. AlphaQuest LLC boosted its stake in shares of Applied Optoelectronics by 243.9% in the 1st quarter. AlphaQuest LLC now owns 2,297 shares of the semiconductor company's stock valued at $35,000 after purchasing an additional 1,629 shares in the last quarter. GAMMA Investing LLC boosted its stake in shares of Applied Optoelectronics by 85.9% in the 2nd quarter. GAMMA Investing LLC now owns 1,785 shares of the semiconductor company's stock valued at $46,000 after purchasing an additional 825 shares in the last quarter. Pinpoint Asset Management Singapore Pte. Ltd. acquired a new stake in shares of Applied Optoelectronics in the 2nd quarter valued at $49,000. Finally, CWM LLC boosted its stake in shares of Applied Optoelectronics by 175.5% in the 2nd quarter. CWM LLC now owns 2,218 shares of the semiconductor company's stock valued at $57,000 after purchasing an additional 1,413 shares in the last quarter. Institutional investors 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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