Royal Bank of Canada Purchases 122,088 Shares of Applied Optoelectronics, Inc. $AAOI

Key Points

• Royal Bank of Canada increased its Applied Optoelectronics stake by 2,075.3% in the first quarter, purchasing 122,088 additional shares and bringing its holdings to 127,971 shares worth approximately $10.8 million.
• Applied Optoelectronics reported stronger-than-expected second-quarter results, with revenue up 86.3% year over year to $191.92 million and adjusted EPS of $0.06. Growth is being driven by accelerating AI data-center demand for 800G and 1.6T optical products, though manufacturing capacity and component shortages are limiting sales.
• Investment sentiment remains mixed: analysts’ average rating is “Hold” with a $134 target price, while Q3 EPS guidance fell below consensus and insiders have sold more than 506,000 shares worth about $87.4 million over the past 90 days.

Royal Bank of Canada lifted its holdings in Applied Optoelectronics, Inc. (NASDAQ:AAOI - Free Report) by 2,075.3% during the first quarter, according to its most recent 13F filing with the Securities & Exchange Commission. The fund owned 127,971 shares of the semiconductor company's stock after buying an additional 122,088 shares during the period. Royal Bank of Canada owned approximately 0.16% of Applied Optoelectronics worth $10,825,000 at the end of the most recent reporting period.

A number of other institutional investors and hedge funds also recently modified their holdings of the business. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. boosted its position in Applied Optoelectronics by 10.4% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 25,579 shares of the semiconductor company's stock worth $393,000 after purchasing an additional 2,415 shares during the last quarter. Cetera Investment Advisers bought a new stake in shares of Applied Optoelectronics during the 2nd quarter worth $377,000. New York State Common Retirement Fund boosted its holdings in shares of Applied Optoelectronics by 36.0% in the 2nd quarter. New York State Common Retirement Fund now owns 17,000 shares of the semiconductor company's stock worth $437,000 after buying an additional 4,500 shares during the last quarter. Invesco Ltd. grew its position in Applied Optoelectronics by 50.0% during the second quarter. Invesco Ltd. now owns 60,817 shares of the semiconductor company's stock valued at $1,562,000 after buying an additional 20,261 shares during the period. Finally, First Trust Advisors LP purchased a new stake in Applied Optoelectronics during the second quarter worth about $952,000. 61.70% of the stock is owned by hedge funds and other institutional investors.

Insiders Place Their Bets

In other news, CEO Chih-Hsiang (Thompson) Lin sold 59,000 shares of the business's stock in a transaction on Friday, June 12th. The shares were sold at an average price of $166.53, for a total transaction of $9,825,270.00. Following the completion of the transaction, the chief executive officer directly owned 1,302,436 shares in the company, valued at $216,894,667.08. The trade was a 4.33% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Shu-Hua (Joshua) Yeh sold 4,715 shares of the company's stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $126.50, for a total transaction of $596,447.50. Following the completion of the transaction, the insider directly owned 383,498 shares in the company, valued at approximately $48,512,497. The trade was a 1.21% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders sold 506,215 shares of company stock worth $87,409,447. Company insiders own 3.80% of the company's stock.

Key Applied Optoelectronics News

Here are the key news stories impacting Applied Optoelectronics this week:

• Positive Sentiment: Q2 results exceeded expectations: Applied Optoelectronics reported adjusted EPS of $0.06 versus consensus estimates near $0.02–$0.03. Revenue reached approximately $191.9 million, ahead of estimates and up about 86% year over year from $103 million. Applied Optoelectronics Q2 Earnings Beat Estimates, Revenues Up Y/Y
• Positive Sentiment: AI datacenter demand is accelerating: Growth was driven by datacenter products, including rapidly expanding 800G optical transceivers. Management is also increasing capacity for 800G and 1.6T products, with demand reportedly exceeding available supply through at least mid-2027. AAOI Q2 Earnings Call Focuses on Capacity-Led 800G Ramp
• Positive Sentiment: Analyst support and industry momentum helped sentiment: Rosenblatt Securities reaffirmed its “buy” rating and assigned a $220 price target. Photonics and optics companies also benefited from strong sector earnings and expectations that potential U.S. restrictions on Chinese optical-transceiver imports could reduce overseas competition. Benzinga analyst rating report
• Neutral Sentiment: Expansion is being limited by supply: Management said it could sell more products if it had greater manufacturing capacity. Component shortages are expected to constrain near-term growth, even as they demonstrate strong underlying demand. Applied Optoelectronics says it could sell more if it could make more
• Negative Sentiment: Q3 profit guidance disappointed: The company forecast EPS of $0.11–$0.26, below the roughly $0.27 analyst consensus, although projected revenue of $255 million–$290 million brackets consensus near $265.7 million. Analysts also flagged competition, a setback in 100G products and valuation concerns after the stock’s substantial rally. Applied Optoelectronics slides amid mixed Q2 results and guidance

Applied Optoelectronics Trading Up 9.2%

Shares of AAOI opened at $135.63 on Friday. The business's 50-day moving average price is $137.34 and its 200-day moving average price is $118.14. Applied Optoelectronics, Inc. has a twelve month low of $18.50 and a twelve month high of $233.67. The stock has a market cap of $10.88 billion, a PE ratio of -173.88 and a beta of 3.76. The company has a quick ratio of 3.03, a current ratio of 3.83 and a debt-to-equity ratio of 0.18.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last released its quarterly earnings data on Thursday, August 6th. The semiconductor company reported $0.06 EPS for the quarter, beating analysts' consensus estimates of $0.02 by $0.04. The company had revenue of $191.92 million during the quarter, compared to analyst estimates of $190.48 million. Applied Optoelectronics had a negative net margin of 9.57% and a negative return on equity of 2.52%. Applied Optoelectronics's revenue was up 86.3% compared to the same quarter last year. During the same period last year, the business earned ($0.16) earnings per share. Applied Optoelectronics has set its Q3 2026 guidance at 0.110-0.260 EPS. On average, equities analysts forecast that Applied Optoelectronics, Inc. will post 0.6 EPS for the current fiscal year.

Analyst Ratings Changes

A number of research firms have weighed in on AAOI. Weiss Ratings reiterated a "sell (d-)" rating on shares of Applied Optoelectronics in a research note on Tuesday, July 7th. Rosenblatt Securities reiterated a "buy" rating and issued a $220.00 price objective on shares of Applied Optoelectronics in a research note on Friday. Wall Street Zen raised Applied Optoelectronics from a "sell" rating to a "hold" rating in a research report on Saturday. Raymond James Financial set a $151.00 target price on Applied Optoelectronics in a research note on Friday. Finally, Needham & Company LLC cut their price target on Applied Optoelectronics from $220.00 to $190.00 and set a "buy" rating for the company in a research note on Friday. Three analysts have rated the stock with a Buy rating, two have given a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, the company currently has an average rating of "Hold" and an average target price of $134.00.

Applied Optoelectronics Company Profile

Applied Optoelectronics, Inc develops and manufactures high-speed fiber-optic networking products designed to support the growing bandwidth demands of data centers, telecommunications carriers and internet content providers. The company's core offerings include pluggable optical transceiver modules, transponders and optical components that enable data transmission at rates ranging from 1G to 400G. These products are used to facilitate long-haul, metro and intra-data center connectivity, addressing the need for scalable, low-latency and energy-efficient solutions in modern network infrastructures.

The company's product portfolio spans small-form factor pluggable modules such as SFP+, QSFP+ and QSFP28 units, as well as more advanced form factors like CFP2 and OSFP for ultra-high-speed applications.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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