Needham & Company LLC Issues Pessimistic Forecast for Applied Optoelectronics (NASDAQ:AAOI) Stock Price

Key Points

• Needham & Company LLC cut its price target on Applied Optoelectronics from $260 to $220, while keeping a buy rating. The new target still implies about 84% upside from the current share price.
• Analyst views on AAOI remain mixed: some firms like Rosenblatt and Raymond James are positive, while Wall Street Zen and Weiss Ratings are bearish. Overall, the stock has a Hold consensus and an average target price of $141.80.
• The company’s latest earnings showed a narrower-than-expected loss but missed revenue estimates, even as sales rose 51.3% year over year. Insiders also sold significant shares recently, including the CFO and another executive.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) had its price objective reduced by Needham & Company LLC from $260.00 to $220.00 in a report issued on Wednesday,Benzinga reports. The brokerage currently has a "buy" rating on the semiconductor company's stock. Needham & Company LLC's price target indicates a potential upside of 84.47% from the company's current price.

A number of other brokerages also recently issued reports on AAOI. Wall Street Zen downgraded shares of Applied Optoelectronics from a "hold" rating to a "sell" rating in a report on Monday, April 13th. Rosenblatt Securities reiterated a "buy" rating and issued a $220.00 price objective on shares of Applied Optoelectronics in a research report on Monday, June 22nd. Raymond James Financial reissued an "outperform" rating on shares of Applied Optoelectronics in a research note on Wednesday, June 10th. Finally, Weiss Ratings restated a "sell (d-)" rating on shares of Applied Optoelectronics in a research report on Tuesday, July 7th. Three analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has assigned a Sell rating to the company. Based on data from MarketBeat.com, the company currently has an average rating of "Hold" and a consensus target price of $141.80.

Applied Optoelectronics Stock Performance

AAOI opened at $119.26 on Wednesday. The company has a current ratio of 3.83, a quick ratio of 3.03 and a debt-to-equity ratio of 0.18. Applied Optoelectronics has a 12-month low of $18.50 and a 12-month high of $233.67. The firm has a 50 day moving average of $156.37 and a two-hundred day moving average of $112.14. The firm has a market capitalization of $9.57 billion, a PE ratio of -180.70 and a beta of 3.69.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last released its quarterly earnings data on Thursday, May 7th. The semiconductor company reported ($0.07) earnings per share for the quarter, missing analysts' consensus estimates of ($0.05) by ($0.02). The business had revenue of $151.14 million during the quarter, compared to analyst estimates of $156.98 million. Applied Optoelectronics had a negative return on equity of 4.64% and a negative net margin of 8.55%.The firm's revenue was up 51.3% compared to the same quarter last year. During the same quarter in the previous year, the company earned ($0.02) EPS. Applied Optoelectronics has set its Q2 2026 guidance at -0.030-0.030 EPS. On average, analysts anticipate that Applied Optoelectronics will post 0.6 EPS for the current year.

Insider Activity at Applied Optoelectronics

In other news, insider Hung-Lun (Fred) Chang sold 40,329 shares of Applied Optoelectronics stock in a transaction that occurred on Wednesday, June 17th. The stock was sold at an average price of $170.60, for a total value of $6,880,127.40. Following the sale, the insider directly owned 286,124 shares of the company's stock, valued at $48,812,754.40. The trade was a 12.35% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Stefan J. Murry sold 4,000 shares of the business's stock in a transaction that occurred on Friday, July 10th. The stock was sold at an average price of $122.09, for a total value of $488,360.00. Following the sale, the chief financial officer owned 380,576 shares of the company's stock, valued at $46,464,523.84. The trade was a 1.04% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 500,215 shares of company stock worth $86,658,774 in the last quarter. Corporate insiders own 3.80% of the company's stock.

Institutional Investors Weigh In On Applied Optoelectronics

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Allworth Financial LP lifted its stake in shares of Applied Optoelectronics by 1,923.7% in the fourth quarter. Allworth Financial LP now owns 769 shares of the semiconductor company's stock worth $27,000 after buying an additional 731 shares in the last quarter. Comerica Bank purchased a new stake in Applied Optoelectronics during the 3rd quarter valued at about $28,000. Northwestern Mutual Wealth Management Co. raised its holdings in Applied Optoelectronics by 166.7% in the 4th quarter. Northwestern Mutual Wealth Management Co. now owns 1,200 shares of the semiconductor company's stock valued at $42,000 after acquiring an additional 750 shares during the last quarter. Kohmann Bosshard Financial Services LLC acquired a new stake in Applied Optoelectronics in the 4th quarter valued at about $55,000. Finally, Headlands Technologies LLC purchased a new position in Applied Optoelectronics in the 2nd quarter worth approximately $57,000. Institutional investors and hedge funds own 61.70% of the company's stock.

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.