Applied Optoelectronics (NASDAQ:AAOI) Shares Gap Up – Should You Buy?

Applied Optoelectronics, Inc. (NASDAQ:AAOI) shares gapped up prior to trading on Friday . The stock had previously closed at $97.42, but opened at $101.20. Applied Optoelectronics shares last traded at $94.9490, with a volume of 2,875,066 shares changing hands.

Analyst Upgrades and Downgrades

A number of research firms recently issued reports on AAOI. Weiss Ratings reiterated a “sell (d-)” rating on shares of Applied Optoelectronics in a research report on Wednesday, January 21st. Rosenblatt Securities restated a “buy” rating and issued a $50.00 target price on shares of Applied Optoelectronics in a research report on Thursday, February 19th. B. Riley Financial raised shares of Applied Optoelectronics from a “sell” rating to a “neutral” rating and set a $54.00 target price on the stock in a research note on Friday, February 27th. Wall Street Zen downgraded shares of Applied Optoelectronics from a “hold” rating to a “sell” rating in a report on Saturday. Finally, Northland Securities reiterated a “market perform” rating and issued a $55.00 price target on shares of Applied Optoelectronics in a research note on Friday, February 27th. Three investment analysts have rated the stock with a Buy rating, three have given a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock currently has an average rating of “Hold” and a consensus price target of $52.80.

Applied Optoelectronics Price Performance

The company has a 50 day moving average price of $68.19 and a 200-day moving average price of $43.59. The company has a market cap of $7.39 billion, a price-to-earnings ratio of -151.09 and a beta of 3.20. The company has a quick ratio of 1.91, a current ratio of 2.63 and a debt-to-equity ratio of 0.18.

Applied Optoelectronics (NASDAQ:AAOI) last posted its earnings results on Thursday, February 26th. The semiconductor company reported ($0.01) EPS for the quarter, topping the consensus estimate of ($0.12) by $0.11. Applied Optoelectronics had a negative net margin of 8.39% and a negative return on equity of 5.29%. The business had revenue of $134.27 million for the quarter, compared to the consensus estimate of $131.56 million. During the same period last year, the company earned ($0.02) EPS. The firm’s revenue was up 33.9% compared to the same quarter last year. Applied Optoelectronics has set its Q1 2026 guidance at -0.090-0.000 EPS. As a group, equities research analysts predict that Applied Optoelectronics, Inc. will post -1.18 EPS for the current fiscal year.

Insider Activity at Applied Optoelectronics

In related news, Director Cynthia Delaney sold 21,000 shares of the business’s stock in a transaction on Wednesday, March 4th. The shares were sold at an average price of $98.02, for a total value of $2,058,420.00. Following the sale, the director owned 116,222 shares of the company’s stock, valued at $11,392,080.44. The trade was a 15.30% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, insider Hung-Lun (Fred) Chang sold 36,400 shares of the stock in a transaction on Monday, March 16th. The shares were sold at an average price of $100.25, for a total value of $3,649,100.00. Following the completion of the sale, the insider owned 233,618 shares of the company’s stock, valued at $23,420,204.50. The trade was a 13.48% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 326,333 shares of company stock valued at $29,392,957 in the last quarter. Insiders own 4.50% of the company’s stock.

Institutional Investors Weigh In On Applied Optoelectronics

Institutional investors and hedge funds have recently made changes to their positions in the stock. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. lifted its stake in shares of Applied Optoelectronics by 10.4% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 25,579 shares of the semiconductor company’s stock worth $393,000 after acquiring an additional 2,415 shares during the period. Cetera Investment Advisers acquired a new stake in Applied Optoelectronics during the 2nd quarter valued at approximately $377,000. Ensign Peak Advisors Inc acquired a new stake in Applied Optoelectronics during the 2nd quarter valued at approximately $537,000. Swiss National Bank raised its holdings in Applied Optoelectronics by 3.4% during the 2nd quarter. Swiss National Bank now owns 91,200 shares of the semiconductor company’s stock worth $2,343,000 after purchasing an additional 3,000 shares during the last quarter. Finally, Legal & General Group Plc raised its holdings in Applied Optoelectronics by 46.5% during the 2nd quarter. Legal & General Group Plc now owns 64,744 shares of the semiconductor company’s stock worth $1,663,000 after purchasing an additional 20,563 shares during the last quarter. Institutional investors and hedge funds own 61.70% of the company’s stock.

Applied Optoelectronics Company Profile

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.