Applied Optoelectronics (NASDAQ:AAOI) Shares Down 7.9% – Should You Sell?

Applied Optoelectronics, Inc. (NASDAQ:AAOI) shares traded down 7.9% on Tuesday . The company traded as low as $177.26 and last traded at $176.4730. 3,796,050 shares changed hands during mid-day trading, a decline of 64% from the average session volume of 10,416,618 shares. The stock had previously closed at $191.55.

Analysts Set New Price Targets

A number of equities analysts recently weighed in on the company. Rosenblatt Securities reissued a “buy” rating and issued a $50.00 price target on shares of Applied Optoelectronics in a research note on Thursday, February 19th. Wall Street Zen cut Applied Optoelectronics from a “hold” rating to a “sell” rating in a research note on Monday, April 13th. Raymond James Financial reissued an “outperform” rating on shares of Applied Optoelectronics in a research note on Wednesday, June 10th. Northland Securities reissued a “market perform” rating and issued a $55.00 price target on shares of Applied Optoelectronics in a research note on Friday, February 27th. Finally, B. Riley Financial raised Applied Optoelectronics from a “sell” rating to a “neutral” rating and set a $54.00 price target on the stock in a research note on Friday, February 27th. Three analysts have rated the stock with a Buy rating, three have assigned a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat.com, Applied Optoelectronics has a consensus rating of “Hold” and an average price target of $79.80.

Applied Optoelectronics Price Performance

The stock has a market capitalization of $14.29 billion, a price-to-earnings ratio of -267.48 and a beta of 3.67. The company has a current ratio of 3.83, a quick ratio of 3.03 and a debt-to-equity ratio of 0.18. The stock has a 50-day simple moving average of $165.57 and a 200 day simple moving average of $93.67.

Applied Optoelectronics (NASDAQ:AAOI) last announced its quarterly earnings data on Thursday, May 7th. The semiconductor company reported ($0.07) EPS for the quarter, missing analysts’ consensus estimates of ($0.05) by ($0.02). Applied Optoelectronics had a negative return on equity of 4.64% and a negative net margin of 8.55%.The business had revenue of $151.14 million for the quarter, compared to analyst estimates of $156.98 million. During the same quarter in the previous year, the business posted ($0.02) earnings per share. The company’s revenue was up 51.3% compared to the same quarter last year. Applied Optoelectronics has set its Q2 2026 guidance at -0.030-0.030 EPS. On average, equities research analysts forecast that Applied Optoelectronics, Inc. will post 0.6 EPS for the current fiscal year.

Insider Activity

In other Applied Optoelectronics news, CFO Stefan J. Murry sold 4,000 shares of the firm’s stock in a transaction dated Wednesday, June 10th. The stock was sold at an average price of $171.45, for a total transaction of $685,800.00. Following the completion of the sale, the chief financial officer directly owned 447,906 shares in the company, valued at approximately $76,793,483.70. This trade represents a 0.89% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Cynthia Delaney sold 56,575 shares of the firm’s stock in a transaction dated Tuesday, May 26th. The stock was sold at an average price of $189.23, for a total value of $10,705,687.25. Following the sale, the director owned 59,647 shares of the company’s stock, valued at $11,287,001.81. The trade was a 48.68% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last three months, insiders sold 298,833 shares of company stock worth $51,058,370. Corporate insiders own 3.80% of the company’s stock.

Institutional Investors Weigh In On Applied Optoelectronics

Institutional investors have recently bought and sold shares of the business. Vanguard Group Inc. lifted its holdings in shares of Applied Optoelectronics by 7.7% during the 4th quarter. Vanguard Group Inc. now owns 4,982,660 shares of the semiconductor company’s stock valued at $173,696,000 after buying an additional 358,090 shares during the last quarter. Invesco Ltd. lifted its holdings in shares of Applied Optoelectronics by 5,208.9% during the 4th 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. Price T Rowe Associates Inc. MD lifted its holdings in shares of Applied Optoelectronics by 5,321.6% during the 4th 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. Hawk Ridge Capital Management LP lifted its holdings in shares of Applied Optoelectronics by 106.2% during the 4th quarter. Hawk Ridge Capital Management LP now owns 1,700,900 shares of the semiconductor company’s stock valued at $59,293,000 after buying an additional 875,903 shares during the last quarter. Finally, Morgan Stanley lifted its holdings in shares of Applied Optoelectronics by 157.1% during the 4th quarter. Morgan Stanley now owns 1,699,855 shares of the semiconductor company’s stock valued at $59,257,000 after buying an additional 1,038,775 shares during the last quarter. 61.70% of the stock is currently owned by institutional investors and hedge funds.

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.