Applied Optoelectronics (NASDAQ:AAOI) Stock Price Down 9.5% - Here's What Happened

Key Points

• Applied Optoelectronics shares fell 9.5% to $62.50, with trading volume reaching 14.8 million shares—42% above the average daily volume.
• Analysts maintain a generally positive outlook, with a “Moderate Buy” consensus and an average price target of $156; however, Needham recently lowered its target to $170.
• The company recently exceeded quarterly earnings and revenue expectations, while revenue grew 86.3% year over year. Insiders sold approximately $6.6 million of stock over the past 90 days.

Shares of Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report) dropped 9.5% during trading on Monday. The company traded as low as $61.88 and last traded at $62.50. 14,798,599 shares changed hands during trading, an increase of 42% from the average daily volume of 10,455,648 shares. The stock had previously closed at $69.05.

Analyst Ratings Changes

Several research analysts recently weighed in on the company. Rosenblatt Securities reaffirmed a "buy" rating and issued a $220.00 target price on shares of Applied Optoelectronics in a research report on Friday, August 7th. Needham & Company LLC cut their price objective on Applied Optoelectronics from $190.00 to $170.00 and set a "buy" rating on the stock in a report on Tuesday, October 27th. Raymond James Financial reaffirmed an "outperform" rating and issued a $178.00 price objective on shares of Applied Optoelectronics in a research note on Tuesday, August 11th. Weiss Ratings raised Applied Optoelectronics from a "sell (e+)" rating to a "sell (d-)" rating in a research note on Wednesday, October 21st. Finally, Northland Securities upgraded Applied Optoelectronics from a "market perform" rating to an "outperform" rating and set a $120.00 target price for the company in a report on Monday. Four research analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat, Applied Optoelectronics has an average rating of "Moderate Buy" and an average target price of $156.00.

Applied Optoelectronics Trading Down 9.5%

The stock has a market capitalization of $5.29 billion, a price-to-earnings ratio of -80.13 and a beta of 4.04. The company has a debt-to-equity ratio of 0.12, a quick ratio of 2.13 and a current ratio of 2.78. The firm has a fifty day moving average of $98.76 and a 200-day moving average of $112.74.

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

Insider Buying and Selling at Applied Optoelectronics

In related news, CFO Stefan Murry sold 4,000 shares of the business's stock in a transaction dated Monday, October 12th. The stock was sold at an average price of $102.87, for a total value of $411,480.00. Following the completion of the sale, the chief financial officer directly owned 363,168 shares of the company's stock, valued at $37,359,092.16. The trade was a 1.09% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available 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 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 transaction, the insider directly owned 249,276 shares in the company, valued at approximately $27,472,707.96. This represents a 11.43% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 56,887 shares of company stock worth $6,581,484 in the last 90 days. 3.80% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Applied Optoelectronics

Several institutional investors and hedge funds have recently bought and sold shares of the business. Polaris Financial Partners bought a new position in shares of Applied Optoelectronics during the third quarter valued at approximately $26,000. EFG International AG bought a new position in shares of Applied Optoelectronics during the second quarter worth about $44,000. Persistent Asset Partners Ltd acquired a new stake in shares of Applied Optoelectronics in the 2nd quarter worth about $47,000. Fiduciary Financial Advisors bought a new stake in Applied Optoelectronics in the 2nd quarter valued at about $48,000. Finally, Integrated Wealth Concepts LLC bought a new stake in Applied Optoelectronics in the 2nd quarter valued at about $58,000. Institutional investors and hedge funds own 61.70% of the company's stock.

Applied Optoelectronics Company Profile

Applied Optoelectronics, Inc NASDAQ: AAOI develops and manufactures fiber-optic networking products and solutions. Its offerings include optical transceivers, transmitters, receivers, lasers, and related components used to transmit data across fiber-optic networks.

The company serves several communications markets, including data centers, broadband access networks, cable television, and telecommunications. Its products are designed for applications such as high-speed data transmission, fiber-to-the-home and other broadband deployments, network connectivity, and communications infrastructure.

Founded in 1997 and headquartered in Sugar Land, Texas, Applied Optoelectronics supports customers in multiple regions, including North America, Asia, and other international markets.

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