Applied Optoelectronics (NASDAQ:AAOI) Shares Climb 4.4% - Here's What Happened

Key Points

• Applied Optoelectronics shares rose 4.4% to about $101.12 in midday trading, although volume was down 86% from the stock’s average daily volume.
• Analyst sentiment remains mixed: the stock has an average rating of “Hold” and a consensus price target of $139.40, with Needham lowering its target to $190 while Rosenblatt maintained a $220 target.
• The company exceeded quarterly expectations, reporting $0.06 in EPS versus $0.02 expected and $191.92 million in revenue, up 86.3% year over year; however, insiders have sold 52,172 shares worth approximately $6.1 million over the past 90 days.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report)'s stock price rose 4.4% during mid-day trading on Tuesday. The stock traded as high as $101.07 and last traded at $101.1230. Approximately 1,441,581 shares traded hands during mid-day trading, a decline of 86% from the average daily volume of 10,209,113 shares. The stock had previously closed at $96.82.

Analysts Set New Price Targets

Several brokerages recently weighed in on AAOI. Needham & Company LLC cut their price target on shares of Applied Optoelectronics from $220.00 to $190.00 and set a "buy" rating on the stock in a report on Friday, August 7th. Rosenblatt Securities restated a "buy" rating and set a $220.00 price objective on shares of Applied Optoelectronics in a research note on Friday, August 7th. Weiss Ratings downgraded shares of Applied Optoelectronics from a "sell (d-)" rating to a "sell (e+)" rating in a research report on Monday, August 17th. Wall Street Zen raised Applied Optoelectronics from a "sell" rating to a "hold" rating in a report on Saturday, August 8th. Finally, B. Riley Financial restated a "neutral" rating on shares of Applied Optoelectronics in a research note on Friday, August 7th. Three investment analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat, Applied Optoelectronics presently has an average rating of "Hold" and a consensus price target of $139.40.

Applied Optoelectronics Trading Up 5.5%

The company has a fifty day moving average of $111.64 and a 200-day moving average of $132.82. The company has a current ratio of 2.78, a quick ratio of 2.13 and a debt-to-equity ratio of 0.12. The company has a market capitalization of $8.64 billion, a price-to-earnings ratio of -130.98 and a beta of 3.79.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last announced its earnings results 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 business had revenue of $191.92 million during the quarter, compared to analysts' expectations of $190.48 million. Applied Optoelectronics had a negative return on equity of 1.98% and a negative net margin of 9.57%.The business's revenue was up 86.3% compared to the same quarter last year. During the same quarter in the prior year, the firm earned ($0.16) earnings per share. Applied Optoelectronics has set its Q3 2026 guidance at 0.110-0.260 EPS. As a group, equities research analysts anticipate that Applied Optoelectronics, Inc. will post 0.55 earnings per share for the current fiscal year.

Insider Buying and Selling

In other news, insider Shu-Hua Yeh sold 6,000 shares of the business's stock in a transaction dated Tuesday, August 18th. The shares were sold at an average price of $147.73, for a total transaction of $886,380.00. Following the transaction, the insider owned 377,498 shares of the company's stock, valued at approximately $55,767,779.54. The trade was a 1.56% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Hung-Lun Chang sold 32,172 shares of the company's stock in a transaction dated Tuesday, September 8th. The shares were sold at an average price of $110.21, for a total transaction of $3,545,676.12. Following the completion of the sale, the insider directly owned 249,276 shares of the company's stock, valued at $27,472,707.96. This represents a 11.43% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last 90 days, insiders have sold 52,172 shares of company stock worth $6,092,409. 3.80% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Applied Optoelectronics

A number of institutional investors have recently bought and sold shares of AAOI. EFG International AG purchased a new stake in shares of Applied Optoelectronics in the 2nd quarter valued at $44,000. Persistent Asset Partners Ltd purchased a new position in Applied Optoelectronics during the 2nd quarter valued at about $47,000. Fiduciary Financial Advisors acquired a new position in Applied Optoelectronics in the 2nd quarter valued at about $48,000. Integrated Wealth Concepts LLC acquired a new position in Applied Optoelectronics in the 2nd quarter valued at about $58,000. Finally, Tema ETFs LLC purchased a new stake in Applied Optoelectronics during the second quarter worth about $62,000. 61.70% of the stock is owned by hedge funds and other institutional investors.

About Applied Optoelectronics

Applied Optoelectronics, Inc develops and manufactures fiber-optic networking products and components. Its offerings include optical transceivers, transponders, modules and related equipment used to transmit data over fiber-optic networks.

The company serves several communications markets, including data centers, telecommunications, broadband access and cable television. Its products support applications such as high-speed data transmission, cloud computing, network infrastructure and fiber-based broadband services.

Founded in 1997 and headquartered in Sugar Land, Texas, Applied Optoelectronics serves customers in North America, Asia and other international markets.

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