Applied Optoelectronics (NASDAQ:AAOI) Stock Price Down 8% - Time to Sell?

Key Points

• Shares of Applied Optoelectronics fell 8% during trading, closing at $24.03, with a 56% decrease in trading volume from the average.
• The company reported an earnings per share (EPS) of (0.16), missing consensus estimates, while revenue increased 137.9% year-over-year to $102.95 million.
• Despite the drop, analysts have a Moderate Buy average rating for the stock, with price targets ranging from $15.00 to $32.00.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report)'s share price traded down 8% on Tuesday . The company traded as low as $23.79 and last traded at $24.03. 1,924,143 shares changed hands during trading, a decline of 56% from the average session volume of 4,422,929 shares. The stock had previously closed at $26.13.

Wall Street Analyst Weigh In

A number of research analysts have recently weighed in on the stock. Rosenblatt Securities increased their target price on shares of Applied Optoelectronics from $30.00 to $34.00 and gave the company a "buy" rating in a research report on Thursday, June 26th. Needham & Company LLC assumed coverage on shares of Applied Optoelectronics in a research report on Friday, July 25th. They set a "buy" rating and a $32.00 target price for the company. Raymond James Financial increased their target price 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. Wall Street Zen downgraded shares of Applied Optoelectronics from a "hold" rating to a "sell" rating in a research report on Saturday, August 9th. Finally, Northland Securities set a $30.00 target price on shares of Applied Optoelectronics in a research report on Friday, August 8th. Four analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat, Applied Optoelectronics has an average rating of "Moderate Buy" and an average price target of $27.20.

Applied Optoelectronics Stock Performance

The company's fifty day moving average is $24.65 and its 200 day moving average is $20.13. The company has a market capitalization of $1.55 billion, a P/E ratio of -7.38 and a beta of 2.72. 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 released its quarterly earnings data on Thursday, August 7th. The semiconductor company reported ($0.16) EPS for the quarter, missing the consensus estimate of ($0.08) by ($0.08). The business had revenue of $102.95 million during the quarter, compared to the consensus estimate of $104.96 million. Applied Optoelectronics had a negative return on equity of 10.60% and a negative net margin of 42.29%.The firm's quarterly revenue was up 137.9% on a year-over-year basis. During the same period last year, the business posted ($0.28) earnings per share. Applied Optoelectronics has set its Q3 2025 guidance at -0.100--0.030 EPS. As a group, equities analysts anticipate that Applied Optoelectronics, Inc. will post -1.18 earnings per share for the current year.

Insider Buying and Selling

In other news, CEO Chih-Hsiang (Thompson) Lin purchased 8,850 shares of the business's stock in a transaction on Wednesday, August 13th. The stock was purchased at an average cost of $22.53 per share, with a total value of $199,390.50. Following the acquisition, the chief executive officer directly owned 1,652,165 shares in the company, valued at approximately $37,223,277.45. This trade represents a 0.54% increase in their ownership of the stock. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, Director Min-Chu (Mike) Chen purchased 7,500 shares of the business's stock in a transaction on Wednesday, August 13th. The stock was purchased at an average cost of $22.91 per share, with a total value of $171,825.00. Following the completion of the acquisition, the director owned 22,500 shares in the company, valued at approximately $515,475. This trade represents a 50.00% increase in their ownership of the stock. The disclosure for this purchase can be found here. In the last 90 days, insiders purchased 44,100 shares of company stock worth $1,000,878 and sold 32,784 shares worth $741,217. Corporate insiders own 4.50% of the company's stock.

Institutional Inflows and Outflows

Several large investors have recently bought and sold shares of the company. Marex Group plc bought a new position in Applied Optoelectronics in the 2nd quarter valued at $1,420,000. Headlands Technologies LLC bought a new position in Applied Optoelectronics in the 2nd quarter valued at $57,000. Tower Research Capital LLC TRC boosted its holdings in Applied Optoelectronics by 244.0% in the 2nd quarter. Tower Research Capital LLC TRC now owns 6,832 shares of the semiconductor company's stock valued at $176,000 after purchasing an additional 4,846 shares during the period. E Fund Management Co. Ltd. bought a new position in Applied Optoelectronics in the 2nd quarter valued at $2,939,000. Finally, Gilder Gagnon Howe & Co. LLC bought a new position in Applied Optoelectronics in the 2nd quarter valued at $1,816,000. 61.72% of the stock is owned by institutional investors.

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.