Applied Optoelectronics, Inc. (AAOI) Stock: A Tech Stock That’s Making Its Way For The Bottom

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Applied Optoelectronics, Inc. (AAOI) is falling in the market in today’s trading session. The stock, focused in the tech sector, is currently trading at $9.17 after heading down -5.56% so far today. When it comes to technology stocks, there are several factors that have the ability to generate price movement in the market. News is one of the most common reasons for movement. Here are the recent headlines centered around AAOI:

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May-16-19 10:04AM Did Applied Optoelectronics, Inc. (NASDAQ:AAOI) Insiders Sell Shares?
May-14-19 07:45AM NASDAQ: AAOI Investor Notice: Update in Lawsuit against Applied Optoelectronics, Inc. announced by Shareholders Foundation
May-09-19 09:55PM Edited Transcript of AAOI earnings conference call or presentation 8-May-19 8:30pm GMT
04:42PM Why Applied Optoelectronics Stock Dropped Today
02:51PM These 5 tech stocks are taking a beating after earnings

Nonetheless, when making a decision to invest, prospective investors should take a look at much more than news, especially in the ever changing technology space. Here’s what’s happening in regard to Applied Optoelectronics, Inc..

Recent Movement From AAOI

While a move down in a single session, like the fall that we’re seeing from Applied Optoelectronics, Inc. may lead to fear in some investors, a single session move by itself shouldn’t be the basis of a decision to, or not to, buy a company’s stock. It is always smart to take a look at trends just a single trading day. As it relates to AAOI, below are the trends that investors have experienced:

  • Past Seven Days – Over the past seven days, AAOI has seen a price change that amounts to -14.38%.
  • Past Month – The return from Applied Optoelectronics, Inc. over the past 30 days works out to -27.05%.
  • Past Quarter – In the past 3 months, the company has generated a ROI of -38.99%
  • Past Six Months – Throughout the previous 6 months, we’ve seen a change that works out to -54.51% from the company.
  • Year To Date – Since the open of this year AAOI has resulted in a ROI of -40.57%.
  • Annually – Finally, in the past year, we’ve seen movement in the amount of -72.48% from AAOI. Over this period of time, the stock has traded at a high price of -81.77% and a low of -5.46%.

Rations That You Should Consider

Looking at a few ratios having to do with a company can provide investors a look of just how risky and/or potentially profitable a pick might be. Below are a few of the key ratios to consider when looking at AAOI.

Short Ratio – The short ratio is a measure of short interest. The higher this ratio, the more investors have a belief that the value of the stock is headed for declines. Throughout the sector, strong tech stocks can come with a lower short ratio. On the other hand, we also tend to see quite a few short squeezes in the sector. Nonetheless, with regard to Applied Optoelectronics, Inc., the stock’s short ratio clocks in at 8.33.

Quick & Current Ratios – The quick and current ratios are tools that measure liquidity. Basically, they measure whether or not a company can pay its debts when they come due with only current assets or quick assets. Because in tech, several companies rely heavily on the continuation of support from investors as they work to bring new technologies to market, these ratios can be upsetting. However, some better companies in the tech sector come with strong current and quick ratios. In terms of AAOI, the quick and current ratios work out to 1.30 and 2.50 respectively.  

Book To Share Value – The book to share value ratio compares the the share price to the book value of assets that are owned by the company. In this particular case, the book to share value ratio comes in at 16.62.

Cash To Share Value – Finally, the cash to share value ratio compares the total cash on hand to the price of the company’s stock. As it relates to AAOI, the cash to share value ratio comes to 2.74.

Big Money And Applied Optoelectronics, Inc.

One thing I have come to understand so far in my short time in existence is that good investors tend to follow big money investors. In other words, investors that are trying to keep their investments relatively safe will follow moves made by institutional investors and insiders. With that said, where is the big money in regard to AAOI? Here’s the scoop:

  • Institutions – At the moment, institutions hold 62.80% of Applied Optoelectronics, Inc.. However, it is worth noting that the ownership held by institutions has seen a move of 2.12% throughout the last quarter.
  • Insider Holdings – with regard to insiders, insiders of the company currently own 5.30% of the company. Their ownership of the company has changed in the amount of -0.19% throughout the last 3 months.

Analyst Opinions Of Applied Optoelectronics, Inc.

While it’s rarely a good idea to avoid doing your due diligence and blindly following the thoughts of analysts, it is a smart idea to consider their opinions in order to validate your own when it comes to making investment decisions in the tech space. Here are the recent moves that we have seen from analysts as it relates to AAOI.

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Feb-22-19 Downgrade Raymond James Outperform → Mkt Perform
Feb-22-19 Downgrade Needham Buy → Hold
Feb-22-19 Downgrade DA Davidson Buy → Neutral $42 → $16
Feb-12-19 Reiterated Rosenblatt Sell $15 → $10
Nov-08-18 Reiterated B. Riley FBR Neutral $22 → $19

Earnings

What have ween seen from AAOI in terms of financial results?Here’s what you’re looking for:

  • Analyst Expectations – As it stands at the moment, Wall St. analysts have expectations that AAOI will create earnings per diluted share coming to a total of -0.11, with -0.37 to be announced in the earnings report for the current quarter. Although this isn’t based on earnings, because we’re talking about analysts, the stock is currently graded as a 3.20 on a scale from 1 to 5 where 1 is the worst average analyst rating and 5 is the best rating.
  • 5-Year Sales – Over the past half decade, Applied Optoelectronics, Inc. has generated a change in sales volume that works out to 27.80%. Earnings per share over the last 5 years have generated movement in the amount of 33.20%.
  • Quarter Over Quarter – when it comes to quarter over quarter data, or Q/Q data as it is generally explained in today’s society, Applied Optoelectronics, Inc. has experienced a change in earnings in the amount of 0. Applied Optoelectronics, Inc. has also seen a change with regard to revenue in the amount of -27.40%.

What’s Going On With Share Counts?

Investors and traders tend to be interested in the total numbers of shares both available and outstanding. In regard to Applied Optoelectronics, Inc., currently there are 20.30M and there is a float of 18.75M. This means that out of the total of 20.30M shares of AAOI that are out there today, 18.75M are available to be traded by the public.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to AAOI, the short percent of the float is 43.33%.

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