Applied Optoelectronics (NASDAQ:AAOI) Stock Price Down 5.7% – Should You Sell?

Applied Optoelectronics, Inc. (NASDAQ:AAOI) was down 5.7% during mid-day trading on Thursday . The company traded as low as $98.20 and last traded at $97.2680. 1,301,492 shares traded hands during trading, a decline of 88% from the average session volume of 10,521,026 shares. The stock had previously closed at $103.13.

Analysts Set New Price Targets

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

Applied Optoelectronics Stock Up 5.1%

The stock has a market cap of $8.92 billion, a price-to-earnings ratio of -135.29 and a beta of 3.79. The business’s 50 day moving average is $117.34 and its 200-day moving average is $129.24. The company has a debt-to-equity ratio of 0.12, a quick ratio of 2.13 and a current ratio of 2.78.

Applied Optoelectronics (NASDAQ:AAOI) 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. The company had revenue of $191.92 million during the quarter, compared to analysts’ expectations of $190.48 million. Applied Optoelectronics had a negative net margin of 9.57% and a negative return on equity of 1.98%. The firm’s revenue for the quarter was up 86.3% on a year-over-year basis. During the same period in the prior year, the business posted ($0.16) earnings per share. Applied Optoelectronics has set its Q3 2026 guidance at 0.110-0.260 EPS. On average, sell-side analysts predict that Applied Optoelectronics, Inc. will post 0.55 EPS for the current fiscal year.

Insider Activity

In related news, insider David Kuo sold 29,227 shares of the firm’s stock in a transaction dated Friday, June 12th. The shares were sold at an average price of $166.53, for a total value of $4,867,172.31. Following the transaction, the insider directly owned 149,078 shares of the company’s stock, valued at approximately $24,825,959.34. This trade represents a 16.39% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Chih-Hsiang Lin sold 59,000 shares of Applied Optoelectronics stock in a transaction dated Friday, June 12th. The stock was sold at an average price of $166.53, for a total value of $9,825,270.00. Following the completion of the sale, the chief executive officer owned 1,302,436 shares in the company, valued at approximately $216,894,667.08. The trade was a 4.33% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders have sold 250,382 shares of company stock worth $41,373,027. Company insiders own 3.80% of the company’s stock.

Institutional Trading of Applied Optoelectronics

Several large investors have recently made changes to their positions in the company. California State Teachers Retirement System lifted its holdings in Applied Optoelectronics by 17,896.9% in the 2nd quarter. California State Teachers Retirement System now owns 12,681,311 shares of the semiconductor company’s stock valued at $1,878,863,000 after purchasing an additional 12,610,847 shares in the last quarter. BlackRock Inc. purchased a new stake in shares of Applied Optoelectronics during the second quarter worth $955,672,000. Vanguard Group Inc. grew its holdings in shares of Applied Optoelectronics by 7.7% during the fourth quarter. Vanguard Group Inc. now owns 4,982,660 shares of the semiconductor company’s stock worth $173,696,000 after buying an additional 358,090 shares in the last quarter. Invesco Ltd. raised its position in shares of Applied Optoelectronics by 5,208.9% in the fourth quarter. Invesco Ltd. now owns 3,512,309 shares of the semiconductor company’s stock valued at $122,439,000 after buying an additional 3,446,150 shares during the last quarter. Finally, Price T Rowe Associates Inc. MD raised its position in shares of Applied Optoelectronics by 5,321.6% in the fourth quarter. Price T Rowe Associates Inc. MD now owns 2,229,757 shares of the semiconductor company’s stock valued at $77,730,000 after buying an additional 2,188,630 shares during the last quarter. 61.70% of the stock is currently owned by hedge funds and other institutional investors.

About Applied Optoelectronics

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.