Applied Optoelectronics, Inc. (AAOI) Stock Analysis
Range Bound setup
Technology · Communication Equipment
Sell if holding. Engine safety override at $154.16: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.6/10. Specifically: High short interest: 13%; Below-average business quality; Rich valuation.
Applied Optoelectronics is a vertically integrated provider of fiber-optic networking products for internet data center, CATV, telecom, and FTTH markets, manufacturing its own laser chips domestically in Sugar Land, Texas. Revenue was $455.7 million in 2025, with CATV... Read more
Sell if holding. Engine safety override at $154.16: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.6/10. Specifically: High short interest: 13%; Below-average business quality; Rich valuation. Chart setup: RSI 51 mid-range, Bollinger mid-band. Score 4.6/10, moderate confidence.
Passes 2/6 gates (clean insider activity, semi cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and earnings proximity 7d<=7d. Suitability: aggressive.
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHCustomerDigicomm53%10-K Item 1: 'In 2025, Digicomm represented 53.1% of our revenue and Microsoft represented 28.8% of our revenue'
- MEDIUMCustomerMicrosoft29%10-K Item 1: 'In 2025, Digicomm represented 53.1% of our revenue and Microsoft represented 28.8% of our revenue'
- HIGHProductCATV market54%10-K Item 1: 'In 2025, we earned 53.8% of our total revenue from the CATV market and 42.9% of our total revenue from the internet data center market'
Material Events(8-K, last 90d)
- 2026-02-19Item 5.02LOWCompensation Committee approved amendment to Employment Agreements for CFO Stefan Murry and three other SVPs on February 13, 2026, enhancing severance terms. Routine compensatory arrangement amendment; no departures.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. Full disclaimer
Rating Breakdown
4 floor-breakers·1 ceiling hit
Ranks in the bottom of its industry peers on the composite signal. Better names in the same sector exist.static
Hyper-growth tech sacrificing current profitability for scale. Floor tripped because model treats negative margins uniformly; the growth dimension tells the other half of the story.static
Priced at a premium — multiples above sector norms. Needs delivery on growth + margins to justify.static
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Engine safety override at $154.16: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.6/10. Specifically: High short interest: 13%; Below-average business quality; Rich valuation. Chart setup: RSI 51 mid-range, Bollinger mid-band. Prior stop was $143.22. Score 4.6/10, moderate confidence.
Take-profit target: $169.94 (+10.4% upside). Prior stop was $143.22. Stop-loss: $143.22.
Concentration risk — Customer: Digicomm (53.1%); Concentration risk — Product: CATV market (53.8%); Target reached (-42.2% upside).
Applied Optoelectronics, Inc. trades at a P/E of N/A (forward 47.8). TrendMatrix value score: 3.1/10. Verdict: Sell.
13 analysts cover AAOI with a consensus score of 3.8/5. Average price target: $102.
What does Applied Optoelectronics, Inc. do?Applied Optoelectronics is a vertically integrated provider of fiber-optic networking products for internet data...
Applied Optoelectronics is a vertically integrated provider of fiber-optic networking products for internet data center, CATV, telecom, and FTTH markets, manufacturing its own laser chips domestically in Sugar Land, Texas. Revenue was $455.7 million in 2025, with CATV contributing 53.8% and internet data center 42.9% of total revenue.