Applied Optoelectronics (NASDAQ:AAOI) Shares Down 2.9% - Should You Sell?

Key Points

• Applied Optoelectronics shares fell 2.9% to $97.78 in active trading, well below the 50-day and 200-day moving averages of $113.92 and $133.60, respectively.
• Analyst sentiment is mixed, with three Buy, two Hold and one Sell ratings; the consensus is Hold with an average price target of $139.40.
• The company exceeded quarterly earnings and revenue expectations, reporting $0.06 EPS and $191.92 million in revenue, with revenue up 86.3% year over year. However, insiders sold 54,172 shares worth $6.3 million over the past three months.

Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report) traded down 2.9% during mid-day trading on Tuesday. The company traded as low as $95.08 and last traded at $97.78. 10,467,806 shares changed hands during trading, an increase of 1% from the average session volume of 10,316,849 shares. The stock had previously closed at $100.68.

Analyst Upgrades and Downgrades

Several analysts recently commented on the stock. Raymond James Financial restated an "outperform" rating and set a $178.00 price target on shares of Applied Optoelectronics in a research report on Tuesday, August 11th. 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. Rosenblatt Securities reissued a "buy" rating and set a $220.00 target price on shares of Applied Optoelectronics in a research note on Friday, August 7th. B. Riley Financial restated a "neutral" rating on shares of Applied Optoelectronics in a research report on Friday, August 7th. Finally, Wall Street Zen upgraded Applied Optoelectronics from a "sell" rating to a "hold" rating in a research note on Saturday, August 8th. Three analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat, Applied Optoelectronics currently has an average rating of "Hold" and an average target price of $139.40.

Applied Optoelectronics Stock Performance

The company has a market cap of $8.27 billion, a PE ratio of -125.36 and a beta of 3.85. The firm's fifty day moving average is $113.92 and its 200 day moving average is $133.60. The company has a current ratio of 2.78, a quick ratio of 2.13 and a debt-to-equity ratio of 0.12.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last posted its quarterly earnings data on Thursday, August 6th. The semiconductor company reported $0.06 earnings per share for the quarter, topping analysts' consensus estimates of $0.02 by $0.04. Applied Optoelectronics had a negative net margin of 9.57% and a negative return on equity of 1.98%. The company had revenue of $191.92 million during the quarter, compared to analysts' expectations of $190.48 million. During the same period in the prior year, the business posted ($0.16) earnings per share. The firm's revenue for the quarter was up 86.3% on a year-over-year basis. Applied Optoelectronics has set its Q3 2026 guidance at 0.110-0.260 EPS. As a group, research analysts predict that Applied Optoelectronics, Inc. will post 0.55 EPS for the current fiscal year.

Insider Activity at Applied Optoelectronics

In other Applied Optoelectronics news, CFO Stefan J. Murry sold 4,000 shares of the business's stock in a transaction that occurred on Thursday, September 10th. The stock was sold at an average price of $105.33, for a total transaction of $421,320.00. Following the completion of the sale, the chief financial officer directly owned 367,168 shares in the company, valued at approximately $38,673,805.44. The trade was a 1.08% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Hung-Lun Chang sold 32,172 shares of the business's stock in a transaction that occurred on Tuesday, September 8th. The stock was sold at an average price of $110.21, for a total value of $3,545,676.12. Following the sale, the insider owned 249,276 shares of the company's stock, valued at approximately $27,472,707.96. This trade represents a 11.43% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last three months, insiders have sold 54,172 shares of company stock valued at $6,324,229. 3.80% of the stock is owned by corporate insiders.

Institutional Trading of Applied Optoelectronics

Large investors have recently made changes to their positions in the company. Polaris Financial Partners purchased a new stake in shares of Applied Optoelectronics in the 3rd quarter valued at approximately $26,000. EFG International AG purchased a new stake in shares of Applied Optoelectronics during the 2nd quarter valued at approximately $44,000. Persistent Asset Partners Ltd purchased a new stake in shares of Applied Optoelectronics during the 2nd quarter valued at approximately $47,000. Fiduciary Financial Advisors purchased a new stake in shares of Applied Optoelectronics during the 2nd quarter valued at approximately $48,000. Finally, Integrated Wealth Concepts LLC acquired a new position in Applied Optoelectronics in the second quarter valued at approximately $58,000. 61.70% of the stock is currently owned by hedge funds and other institutional investors.

About Applied Optoelectronics

Applied Optoelectronics, Inc NASDAQ: AAOI develops and manufactures fiber-optic networking products used to transmit data across broadband, data center, telecommunications and wireless networks. Its portfolio includes optical transceivers, modules, lasers, components and networking equipment designed for high-speed communications infrastructure.

The company serves communications service providers, cable television and broadband operators, internet content providers, data center operators and telecommunications customers.

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