Traders Buy High Volume of Applied Optoelectronics Call Options (NASDAQ:AAOI)

Key Points

• Applied Optoelectronics experienced a **399% increase** in call options trading, with investors purchasing **50,213 call options** compared to the usual daily volume of **10,061**.
• CEO **Chih-Hsiang Lin** increased his holdings by **21,200 shares**, while insider **Hung-Lun Chang** sold **23,837 shares**, reflecting mixed insider sentiment about the company.
• Analysts are optimistic, with **Needham & Company** rating the stock as a "buy" with a target price of **$32.00** and an average consensus price target of **$26.00** across various brokerages.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report) was the target of unusually large options trading activity on Monday. Investors purchased 50,213 call options on the company. Thisrepresentsanincreaseofapproximately399% compared to the average daily volume of 10,061 call options.

Applied Optoelectronics Trading Down 5.7%

Shares of NASDAQ AAOI traded down $1.30 during mid-day trading on Friday, hitting $21.57. The company's stock had a trading volume of 1,747,880 shares, compared to its average volume of 4,295,028. The stock has a market cap of $1.20 billion, a price-to-earnings ratio of -5.61 and a beta of 2.78. The company has a debt-to-equity ratio of 0.47, a current ratio of 1.88 and a quick ratio of 1.34. Applied Optoelectronics has a one year low of $6.70 and a one year high of $44.50. The company's fifty day simple moving average is $22.80 and its 200-day simple moving average is $20.90.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last issued its earnings results on Thursday, May 8th. The semiconductor company reported ($0.02) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.04) by $0.02. The company had revenue of $99.86 million for the quarter, compared to analyst estimates of $99.37 million. Applied Optoelectronics had a negative net margin of 55.98% and a negative return on equity of 15.40%. The company's revenue for the quarter was up 145.5% on a year-over-year basis. During the same quarter last year, the firm earned ($0.31) EPS. On average, sell-side analysts anticipate that Applied Optoelectronics will post -1.18 earnings per share for the current fiscal year.

Wall Street Analyst Weigh In

AAOI has been the subject of a number of recent analyst reports. Wall Street Zen upgraded shares of Applied Optoelectronics from a "sell" rating to a "hold" rating in a research report on Saturday, June 21st. Raymond James Financial decreased their price objective on shares of Applied Optoelectronics from $20.00 to $18.00 and set an "outperform" rating on the stock in a report on Friday, May 9th. Rosenblatt Securities increased 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. Needham & Company LLC started coverage on shares of Applied Optoelectronics in a report on Friday, July 25th. They set a "buy" rating and a $32.00 price objective on the stock. Finally, Wolfe Research started coverage on shares of Applied Optoelectronics in a report on Tuesday, July 8th. They set a "peer perform" rating on the stock. Four analysts have rated the stock with a hold rating and four have assigned a buy rating to the company. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and an average price target of $26.00.

Insider Activity

In related news, insider David C. Kuo sold 11,426 shares of the stock in a transaction dated Wednesday, May 14th. The shares were sold at an average price of $19.10, for a total transaction of $218,236.60. Following the completion of the sale, the insider owned 153,900 shares in the company, valued at $2,939,490. This trade represents a 6.91% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, CEO Chih-Hsiang (Thompson) Lin bought 21,200 shares of the company's stock in a transaction that occurred on Tuesday, May 13th. The shares were purchased at an average price of $18.22 per share, with a total value of $386,264.00. Following the transaction, the chief executive officer directly owned 1,659,025 shares in the company, valued at $30,227,435.50. This represents a 1.29% increase in their ownership of the stock. The disclosure for this purchase can be found here. Over the last 90 days, insiders have sold 40,263 shares of company stock worth $787,050. Company insiders own 4.50% of the company's stock.

Institutional Trading of Applied Optoelectronics

A number of hedge funds have recently modified their holdings of the company. Corebridge Financial Inc. raised its position in shares of Applied Optoelectronics by 2.4% in the 4th quarter. Corebridge Financial Inc. now owns 20,253 shares of the semiconductor company's stock valued at $747,000 after acquiring an additional 471 shares during the period. Summit Investment Advisors Inc. raised its holdings in shares of Applied Optoelectronics by 17.6% in the fourth 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 last quarter. Rhumbline Advisers raised its holdings in shares of Applied Optoelectronics by 1.1% in the first quarter. Rhumbline Advisers now owns 61,017 shares of the semiconductor company's stock valued at $937,000 after purchasing an additional 669 shares during the last quarter. Nisa Investment Advisors LLC raised its holdings in shares of Applied Optoelectronics by 497.5% in the second quarter. Nisa Investment Advisors LLC now owns 962 shares of the semiconductor company's stock valued at $25,000 after purchasing an additional 801 shares during the last quarter. Finally, GAMMA Investing LLC raised its holdings in shares of Applied Optoelectronics by 85.9% in the second 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 during the last quarter. 61.72% of the stock is currently 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.