Have Insiders Sold Applied Optoelectronics Shares Recently?

We'd be surprised if Applied Optoelectronics, Inc. (NASDAQ:AAOI) shareholders haven't noticed that the Senior VP & North America General Manager, Hung-Lun Chang, recently sold US$454k worth of stock at US$19.06 per share. That sale was 13% of their holding, so it does make us raise an eyebrow.

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The Last 12 Months Of Insider Transactions At Applied Optoelectronics

Notably, that recent sale by Senior VP & North America General Manager Hung-Lun Chang was not the only time they sold Applied Optoelectronics shares this year. They previously made an even bigger sale of -US$617k worth of shares at a price of US$30.35 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$18.69). So it may not tell us anything about how insiders feel about the current share price.

Over the last year we saw more insider selling of Applied Optoelectronics shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Applied Optoelectronics

I will like Applied Optoelectronics better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership Of Applied Optoelectronics

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Applied Optoelectronics insiders own about US$56m worth of shares. That equates to 5.4% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Applied Optoelectronics Insider Transactions Indicate?

The stark truth for Applied Optoelectronics is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example, Applied Optoelectronics has 4 warning signs (and 3 which are a bit unpleasant) we think you should know about.

But note: Applied Optoelectronics may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.