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APPLIED OPTOELECTRONICS INC (AAOI) Stock Fundamental Analysis

NASDAQ:AAOI - Nasdaq - US03823U1025 - Common Stock - Currency: USD

10.66  +0.23 (+2.21%)

After market: 10.74 +0.08 (+0.75%)

Fundamental Rating

2

We assign a fundamental rating of 2 out of 10 to AAOI. AAOI was compared to 49 industry peers in the Communications Equipment industry. Both the profitability and financial health of AAOI have multiple concerns. While showing a medium growth rate, AAOI is valued expensive at the moment.


Dividend Valuation Growth Profitability Health

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0

1. Profitability

1.1 Basic Checks

AAOI had negative earnings in the past year.
In the past year AAOI has reported a negative cash flow from operations.
AAOI had negative earnings in each of the past 5 years.
In the past 5 years AAOI always reported negative operating cash flow.
AAOI Yearly Net Income VS EBIT VS OCF VS FCFAAOI Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 50M -50M -100M -150M

1.2 Ratios

Looking at the Return On Assets, with a value of -34.14%, AAOI is doing worse than 77.55% of the companies in the same industry.
AAOI has a Return On Equity of -81.50%. This is in the lower half of the industry: AAOI underperforms 73.47% of its industry peers.
Industry RankSector Rank
ROA -34.14%
ROE -81.5%
ROIC N/A
ROA(3y)-21.6%
ROA(5y)-17.78%
ROE(3y)-47.85%
ROE(5y)-37.18%
ROIC(3y)N/A
ROIC(5y)N/A
AAOI Yearly ROA, ROE, ROICAAOI Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 -40 -60 -80

1.3 Margins

AAOI's Gross Margin of 24.78% is on the low side compared to the rest of the industry. AAOI is outperformed by 79.59% of its industry peers.
AAOI's Gross Margin has been stable in the last couple of years.
The Profit Margin and Operating Margin are not available for AAOI so they could not be analyzed.
Industry RankSector Rank
OM N/A
PM (TTM) N/A
GM 24.78%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y11.63%
GM growth 5Y0.48%
AAOI Yearly Profit, Operating, Gross MarginsAAOI Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 -40 -60

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2

2. Health

2.1 Basic Checks

AAOI does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for AAOI has been increased compared to 1 year ago.
The number of shares outstanding for AAOI has been increased compared to 5 years ago.
Compared to 1 year ago, AAOI has a worse debt to assets ratio.
AAOI Yearly Shares OutstandingAAOI Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10M 20M 30M 40M
AAOI Yearly Total Debt VS Total AssetsAAOI Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M 500M

2.2 Solvency

Based on the Altman-Z score of 0.17, we must say that AAOI is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.17, AAOI is in line with its industry, outperforming 40.82% of the companies in the same industry.
A Debt/Equity ratio of 0.69 indicates that AAOI is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.69, AAOI is doing worse than 69.39% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.69
Debt/FCF N/A
Altman-Z 0.17
ROIC/WACCN/A
WACC9.06%
AAOI Yearly LT Debt VS Equity VS FCFAAOI Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M -100M 200M 300M

2.3 Liquidity

A Current Ratio of 1.77 indicates that AAOI should not have too much problems paying its short term obligations.
AAOI has a Current ratio (1.77) which is in line with its industry peers.
AAOI has a Quick Ratio of 1.25. This is a normal value and indicates that AAOI is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of AAOI (1.25) is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.77
Quick Ratio 1.25
AAOI Yearly Current Assets VS Current LiabilitesAAOI Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M

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5

3. Growth

3.1 Past

The earnings per share for AAOI have decreased strongly by -74.47% in the last year.
Looking at the last year, AAOI shows a quite strong growth in Revenue. The Revenue has grown by 14.62% in the last year.
The Revenue has been growing slightly by 5.49% on average over the past years.
EPS 1Y (TTM)-74.47%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-150%
Revenue 1Y (TTM)14.62%
Revenue growth 3Y5.63%
Revenue growth 5Y5.49%
Sales Q2Q%65.87%

3.2 Future

Based on estimates for the next years, AAOI will show a very strong growth in Earnings Per Share. The EPS will grow by 92.95% on average per year.
Based on estimates for the next years, AAOI will show a very strong growth in Revenue. The Revenue will grow by 85.44% on average per year.
EPS Next Y176.72%
EPS Next 2Y92.95%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year109.6%
Revenue Next 2Y85.44%
Revenue Next 3YN/A
Revenue Next 5YN/A

3.3 Evolution

When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
AAOI Yearly Revenue VS EstimatesAAOI Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 200M 400M 600M 800M
AAOI Yearly EPS VS EstimatesAAOI Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0 1 -1 2 3 4

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3

4. Valuation

4.1 Price/Earnings Ratio

AAOI reported negative earnings for the last year, which makes the Price/Earnings Ratio negative.
A Price/Forward Earnings ratio of 16.95 indicates a correct valuation of AAOI.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AAOI indicates a somewhat cheap valuation: AAOI is cheaper than 61.22% of the companies listed in the same industry.
AAOI is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE N/A
Fwd PE 16.95
AAOI Price Earnings VS Forward Price EarningsAAOI Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 0 10 -10 20 30

4.2 Price Multiples

Industry RankSector Rank
P/FCF N/A
EV/EBITDA N/A
AAOI Per share dataAAOI EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 -2 4

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
AAOI's earnings are expected to grow with 92.95% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y92.95%
EPS Next 3YN/A

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0

5. Dividend

5.1 Amount

AAOI does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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APPLIED OPTOELECTRONICS INC

NASDAQ:AAOI (4/17/2025, 8:00:24 PM)

After market: 10.74 +0.08 (+0.75%)

10.66

+0.23 (+2.21%)

Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)02-26 2025-02-26/amc
Earnings (Next)05-01 2025-05-01/amc
Inst Owners65.18%
Inst Owner Change0%
Ins Owners4.3%
Ins Owner Change-6.64%
Market Cap535.66M
Analysts80
Price Target38.96 (265.48%)
Short Float %20.36%
Short Ratio2.32
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-15.83%
Min EPS beat(2)-22.73%
Max EPS beat(2)-8.93%
EPS beat(4)1
Avg EPS beat(4)-7.35%
Min EPS beat(4)-22.73%
Max EPS beat(4)6.15%
EPS beat(8)4
Avg EPS beat(8)963.3%
EPS beat(12)8
Avg EPS beat(12)647.75%
EPS beat(16)12
Avg EPS beat(16)491.14%
Revenue beat(2)1
Avg Revenue beat(2)0.18%
Min Revenue beat(2)-1.68%
Max Revenue beat(2)2.04%
Revenue beat(4)1
Avg Revenue beat(4)-3.02%
Min Revenue beat(4)-8.53%
Max Revenue beat(4)2.04%
Revenue beat(8)1
Avg Revenue beat(8)-4.59%
Revenue beat(12)1
Avg Revenue beat(12)-4.69%
Revenue beat(16)2
Avg Revenue beat(16)-3.84%
PT rev (1m)13.02%
PT rev (3m)11.53%
EPS NQ rev (1m)-3.57%
EPS NQ rev (3m)-2171.43%
EPS NY rev (1m)-27.42%
EPS NY rev (3m)-16.06%
Revenue NQ rev (1m)-0.36%
Revenue NQ rev (3m)-1.96%
Revenue NY rev (1m)-0.19%
Revenue NY rev (3m)-3.82%
Valuation
Industry RankSector Rank
PE N/A
Fwd PE 16.95
P/S 2.15
P/FCF N/A
P/OCF N/A
P/B 2.34
P/tB 2.38
EV/EBITDA N/A
EPS(TTM)-0.82
EYN/A
EPS(NY)0.63
Fwd EY5.9%
FCF(TTM)-2.26
FCFYN/A
OCF(TTM)-1.38
OCFYN/A
SpS4.96
BVpS4.56
TBVpS4.49
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -34.14%
ROE -81.5%
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) N/A
GM 24.78%
FCFM N/A
ROA(3y)-21.6%
ROA(5y)-17.78%
ROE(3y)-47.85%
ROE(5y)-37.18%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y11.63%
GM growth 5Y0.48%
F-Score1
Asset Turnover0.46
Health
Industry RankSector Rank
Debt/Equity 0.69
Debt/FCF N/A
Debt/EBITDA N/A
Cap/Depr 212.66%
Cap/Sales 17.61%
Interest Coverage N/A
Cash Conversion N/A
Profit Quality N/A
Current Ratio 1.77
Quick Ratio 1.25
Altman-Z 0.17
F-Score1
WACC9.06%
ROIC/WACCN/A
Cap/Depr(3y)91.99%
Cap/Depr(5y)75.01%
Cap/Sales(3y)7.91%
Cap/Sales(5y)6.93%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-74.47%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-150%
EPS Next Y176.72%
EPS Next 2Y92.95%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)14.62%
Revenue growth 3Y5.63%
Revenue growth 5Y5.49%
Sales Q2Q%65.87%
Revenue Next Year109.6%
Revenue Next 2Y85.44%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-71.15%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year240.97%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-544.68%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-776.86%
OCF growth 3YN/A
OCF growth 5YN/A