Applied Optoelectronics (NASDAQ:AAOI) Stock Price Up 3.5% - Here's Why

Key Points

• AAOI shares rose 3.5% to $78.20 in midday trading, with volume about 9% above the average session level.
• The company beat quarterly estimates, reporting $0.06 EPS versus $0.02 expected and $191.92 million in revenue, up 86.3% year over year; however, it remains unprofitable with a negative net margin.
• Analysts have a consensus “Hold” rating and an average price target of $147, while insiders sold 58,172 shares worth approximately $6.7 million during the last quarter.

Shares of Applied Optoelectronics, Inc. (NASDAQ:AAOI - Get Free Report) were up 3.5% during mid-day trading on Monday. The company traded as high as $80.47 and last traded at $78.20. 11,326,262 shares changed hands during mid-day trading, an increase of 9% from the average session volume of 10,403,335 shares. The stock had previously closed at $75.57.

Wall Street Analyst Weigh In

AAOI has been the topic of a number of analyst reports. Wall Street Zen upgraded Applied Optoelectronics from a "sell" rating to a "hold" rating in a report on Saturday, August 8th. Weiss Ratings cut Applied Optoelectronics from a "sell (d-)" rating to a "sell (e+)" rating in a report on Monday, August 17th. 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 report on Friday, August 7th. Rosenblatt Securities restated a "buy" rating and issued a $220.00 price objective on shares of Applied Optoelectronics in a research report on Friday, August 7th. Finally, Raymond James Financial reaffirmed an "outperform" rating and set a $178.00 price objective on shares of Applied Optoelectronics in a research note on Tuesday, August 11th. Three equities research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, the company has a consensus rating of "Hold" and an average target price of $147.00.

Applied Optoelectronics Stock Up 3.5%

The company has a quick ratio of 2.13, a current ratio of 2.78 and a debt-to-equity ratio of 0.12. The firm has a market cap of $6.61 billion, a PE ratio of -100.26 and a beta of 3.85. The firm's 50 day moving average is $110.39 and its 200-day moving average is $133.24.

Applied Optoelectronics (NASDAQ:AAOI - Get Free Report) last announced its earnings results on Thursday, August 6th. The semiconductor company reported $0.06 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.02 by $0.04. The firm had revenue of $191.92 million for 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 1.98%. Applied Optoelectronics's revenue was up 86.3% compared to the same quarter last year. During the same quarter last year, the business 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 expect that Applied Optoelectronics, Inc. will post 0.55 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other news, CFO Stefan J. Murry sold 4,000 shares of Applied Optoelectronics stock in a transaction on 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 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 document filed with the Securities & Exchange Commission, which is available at the SEC website. 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 on Tuesday, September 8th. The shares were sold at an average price of $110.21, for a total value of $3,545,676.12. Following the completion of the transaction, the insider owned 249,276 shares of the company's stock, valued at $27,472,707.96. The trade was a 11.43% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 58,172 shares of company stock valued at $6,735,709 in the last quarter. 3.80% of the stock is currently owned by company insiders.

Institutional Trading of Applied Optoelectronics

A number of hedge funds have recently added to or reduced their stakes in the business. California State Teachers Retirement System lifted its stake in shares of Applied Optoelectronics by 23.2% in the 1st quarter. California State Teachers Retirement System now owns 70,464 shares of the semiconductor company's stock valued at $5,961,000 after purchasing an additional 13,265 shares in the last quarter. Handelsbanken Fonder AB purchased a new stake in shares of Applied Optoelectronics during the 2nd quarter worth about $7,719,000. BlackRock Inc. purchased a new stake in shares of Applied Optoelectronics during the 2nd quarter worth about $955,672,000. Bank of America Corp DE acquired a new stake in Applied Optoelectronics during the 2nd quarter worth approximately $33,712,000. Finally, Quantitative Investment Management LLC acquired a new stake in Applied Optoelectronics during the 2nd quarter worth approximately $1,474,000. 61.70% of the stock is owned by institutional investors and hedge funds.

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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