For Applied Optoelectronics Inc. [AAOI], Analyst sees a drop to $9. What next?

Applied Optoelectronics Inc. [NASDAQ: AAOI] closed the trading session at $9.32 on 02/26/21. The day’s price range saw the stock hit a low of $9.2011, while the highest price level was $10.72. The company report on February 26, 2021 that Applied Optoelectronics Reports Fourth Quarter and Full Year 2020 Results.

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Applied Optoelectronics, Inc. (NASDAQ: AAOI), a leading provider of fiber-optic access network products for the internet datacenter, cable broadband, telecom and fiber-to-the-home (FTTH) markets, announced financial results for its fourth quarter and full year ended December 31, 2020.

“Despite the challenges presented by the pandemic and a slow end to the year, we are encouraged by the double-digit revenue growth we delivered in 2020, which was driven by growth in each of our three major business segments,” said Dr. Thompson Lin, Applied Optoelectronics Inc. Founder, President and Chief Executive Officer. “We are pleased to have secured an additional 30 total design wins in 2020, on par with last year’s total. We continue to see increased customer interest in our 400G product portfolio and we anticipate revenue contribution from these products in the second half of the year. The investments we have made in product development for our CATV customers have resulted in our best quarter of CATV revenue in several years. While we expect some of the headwinds we are seeing in the datacenter market to persist through the first quarter, we believe we are well positioned to meet our customers’ needs as demand begins to recover and we remain focused on driving shareholder value.”.

The stocks have a year to date performance of 9.58 percent and weekly performance of -24.19 percent. The stock has been moved at -20.91 percent over the last six months. The stock has performed -23.38 percent around the most recent 30 days and changed 17.89 percent over the most recent 3-months.

If compared to the average trading volume of 765.20K shares, AAOI reached to a volume of 1833040 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here’s what leading stock market gurus have to say about Applied Optoelectronics Inc. [AAOI]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for AAOI shares is $10.44 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on AAOI stock is a recommendation set at 2.80. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Needham have made an estimate for Applied Optoelectronics Inc. shares, keeping their opinion on the stock as Buy, with their previous recommendation back on November 09, 2020. While these analysts kept the previous recommendation, B. Riley Securities raised their target price from $11 to $9. The new note on the price target was released on November 06, 2020, representing the official price target for Applied Optoelectronics Inc. stock. Previously, the target price had yet another raise to $10, while Northland Capital analysts kept a Market Perform rating on AAOI stock.

The Average True Range (ATR) for Applied Optoelectronics Inc. is set at 0.87, with the Price to Sales ratio for AAOI stock in the period of the last 12 months amounting to 1.11. The Price to Book ratio for the last quarter was 0.79, with the Price to Cash per share for the same quarter was set at 1.58.

AAOI stock trade performance evaluation

Applied Optoelectronics Inc. [AAOI] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -24.19. With this latest performance, AAOI shares dropped by -23.38% in over the last four-week period, additionally sinking by -20.91% over the last 6 months – not to mention a drop of -2.46% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for AAOI stock in for the last two-week period is set at 34.59, with the RSI for the last a single of trading hit 26.44, and the three-weeks RSI is set at 39.90 for Applied Optoelectronics Inc. [AAOI]. The present Moving Average for the last 50 days of trading for this stock 10.46, while it was recorded at 11.05 for the last single week of trading, and 10.46 for the last 200 days.

Applied Optoelectronics Inc. [AAOI]: An insightful look at the core fundamentals

Operating Margin for any stock indicates how profitable investing would be, and Applied Optoelectronics Inc. [AAOI] shares currently have an operating margin of -25.54 and a Gross Margin at +23.94. Applied Optoelectronics Inc.’s Net Margin is presently recorded at -34.60.

Return on Total Capital for AAOI is now -11.69, given the latest momentum, and Return on Invested Capital for the company is -17.27. Return on Equity for this stock declined to -21.91, with Return on Assets sitting at -14.15. When it comes to the capital structure of this company, Applied Optoelectronics Inc. [AAOI] has a Total Debt to Total Equity ratio set at 51.99. Additionally, AAOI Total Debt to Total Capital is recorded at 34.21, with Total Debt to Total Assets ending up at 30.49. Long-Term Debt to Equity for the company is recorded at 37.14, with the Long-Term Debt to Total Capital now at 24.43.

Reflecting on the efficiency of the workforce at the company, Applied Optoelectronics Inc. [AAOI] managed to generate an average of -$21,204 per employee. Receivables Turnover for the company is 5.86 with a Total Asset Turnover recorded at a value of 0.41.Applied Optoelectronics Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.00 and a Current Ratio set at 2.00.

Earnings per share (EPS) analysis for Applied Optoelectronics Inc. [AAOI] stock

With the latest financial reports released by the company, Applied Optoelectronics Inc. posted -0.44/share EPS, while the average EPS was predicted by analysts to be reported at -0.38/share. When compared, the two values demonstrate that the company fail the estimates by a Surprise Factor of -15.80%. The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for AAOI. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Applied Optoelectronics Inc. go to 13.00%.

Applied Optoelectronics Inc. [AAOI]: Insider Ownership positions

There are presently around $105 million, or 49.60% of AAOI stock, in the hands of institutional investors. The top three institutional holders of AAOI stocks are: BLACKROCK INC. with ownership of 3,447,082, which is approximately 3.233% of the company’s market cap and around 6.90% of the total institutional ownership; VANGUARD GROUP INC, holding 1,439,208 shares of the stock with an approximate value of $13.42 million in AAOI stocks shares; and STATE STREET CORP, currently with $5.7 million in AAOI stock with ownership of nearly 0.872% of the company’s market capitalization.

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Positions in Applied Optoelectronics Inc. stocks held by institutional investors increased at the end of February and at the time of the February reporting period, where 52 institutional holders increased their position in Applied Optoelectronics Inc. [NASDAQ:AAOI] by around 1,723,632 shares. Additionally, 55 investors decreased positions by around 1,414,152 shares, while 18 investors held positions by with 8,084,940 shares. The mentioned changes placed institutional holdings at 11,222,724 shares, according to the latest SEC report filing. AAOI stock had 21 new institutional investments in for a total of 908,147 shares, while 21 institutional investors sold positions of 1,064,363 shares during the same period.

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