NasdaqGM:AAOI

Stock Analysis Report

Applied Optoelectronics

Executive Summary

Applied Optoelectronics, Inc. designs, manufactures, and sells various fiber-optic networking products worldwide.

Snowflake

Fundamentals

Fair value with imperfect balance sheet.


Similar Companies

Share Price & News

How has Applied Optoelectronics's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

5.6%

NasdaqGM:AAOI

2.4%

US Communications

1.3%

US Market


1 Year Return

-67.2%

NasdaqGM:AAOI

0.8%

US Communications

2.0%

US Market

AAOI underperformed the Communications industry which returned 0.8% over the past year.

AAOI underperformed the Market in United States of America which returned 1.7% over the past year.


Share holder returns

AAOIIndustryMarket
7 Day5.6%2.4%1.3%
30 Day20.9%6.1%3.9%
90 Day25.2%-6.9%3.4%
1 Year-67.2%-67.2%3.0%0.8%4.2%2.0%
3 Year-49.3%-49.3%57.5%47.6%47.2%37.6%
5 Year-34.7%-34.7%87.6%68.1%60.5%42.9%

Price Volatility Vs. Market

How volatile is Applied Optoelectronics's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Applied Optoelectronics undervalued based on future cash flows and its price relative to the stock market?

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Applied Optoelectronics's share price is below the future cash flow value, and at a moderate discount (> 20%).

Applied Optoelectronics's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Applied Optoelectronics is loss making, we can't compare its value to the US Communications industry average.

Applied Optoelectronics is loss making, we can't compare the value of its earnings to the United States of America market.


Price Based on Expected Growth

Unable to calculate PEG ratio for Applied Optoelectronics, we can't assess if its growth is good value.


Price Based on Value of Assets

Applied Optoelectronics is good value based on assets compared to the US Communications industry average.


Next Steps

Future Growth

How is Applied Optoelectronics expected to perform in the next 1 to 3 years based on estimates from 10 analysts?

46.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Applied Optoelectronics's revenue is expected to grow by 15.9% yearly, however this is not considered high growth (20% yearly).

Applied Optoelectronics is not considered high growth as it is expected to be loss making for the next 1-3 years.

Applied Optoelectronics's revenue growth is expected to exceed the United States of America market average.

Unable to compare Applied Optoelectronics's earnings growth to the United States of America market average as it is expected to be loss making during the next 1-3 years.

Unable to compare Applied Optoelectronics's earnings growth to the low risk savings rate as it is expected to be loss making during the next 1-3 years.


Earnings per Share Growth Estimates


Future Return on Equity

Applied Optoelectronics is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has Applied Optoelectronics performed over the past 5 years?

10.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Applied Optoelectronics does not make a profit even though their year on year earnings growth rate was positive over the past 5 years.

Unable to compare Applied Optoelectronics's 1-year earnings growth to the 5-year average as it is not currently profitable.

Unable to compare Applied Optoelectronics's 1-year growth to the US Communications industry average as it is not currently profitable.


Return on Equity

It is difficult to establish if Applied Optoelectronics has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) as it is loss-making.


Return on Assets

It is difficult to establish if Applied Optoelectronics has efficiently used its assets last year compared to the US Communications industry average (Return on Assets) as it is loss-making.


Return on Capital Employed

It is difficult to establish if Applied Optoelectronics improved its use of capital last year versus 3 years ago (Return on Capital Employed) as it is currently loss-making.


Next Steps

Financial Health

How is Applied Optoelectronics's financial position?


Financial Position Analysis

Applied Optoelectronics is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Applied Optoelectronics's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Applied Optoelectronics's level of debt (41.3%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (10.9% vs 41.3% today).

Debt is not well covered by operating cash flow (2.4%, less than 20% of total debt).

Unable to confirm if the interest payments on Applied Optoelectronics's debt are well covered by earnings due to lack of past financial data.


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 1.6x debt.


Next Steps

Dividend

What is Applied Optoelectronics's current dividend yield, its reliability and sustainability?


Dividend Yield and Payments Analysis

Unable to evaluate Applied Optoelectronics's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.

Unable to evaluate Applied Optoelectronics's dividend against the top 25% market benchmark as the company has not reported any payouts.

Unable to perform a dividend volatility check as Applied Optoelectronics has not reported any payouts.

Unable to verify if Applied Optoelectronics's dividend has been increasing as the company has not reported any payouts.


Current Payout to Shareholders

Unable to calculate sustainability of dividends as Applied Optoelectronics has not reported any payouts.


Future Payout to Shareholders

Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.


Next Steps

Management

What is the CEO of Applied Optoelectronics's salary, the management and board of directors tenure and is there insider trading?

6.9yrs

Average management tenure


CEO

Thompson Lin (56yo)

22.6yrs

Tenure

US$4,705,496

Compensation

Dr. Chih-Hsiang Lin, also known as Thompson, Ph.D., founded Applied Optoelectronics, Inc., in 1997 and has been its President, Chief Executive Officer. Dr. Lin has been the Chairman of the Board at Applied ...


CEO Compensation Analysis

Thompson's remuneration is higher than average for companies of similar size in United States of America.

Thompson's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

6.9yrs

Average Tenure

53yo

Average Age

The average tenure for the Applied Optoelectronics management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

6.5yrs

Average Tenure

67yo

Average Age

The tenure for the Applied Optoelectronics board of directors is about average.


Insider Trading

No 3 month open market individual insider trading information.


Ownership Breakdown


Management Team

  • Thompson Lin (56yo)

    Founder

    • Tenure: 22.6yrs
    • Compensation: US$4.71m
  • Stefan Murry (46yo)

    CFO & Chief Strategy Officer

    • Tenure: 5.1yrs
    • Compensation: US$1.21m
  • Fred Chang (55yo)

    Senior VP of Optical Component Business Unit & GM of North America

    • Tenure: 6.9yrs
    • Compensation: US$1.21m
  • Joshua Yeh (53yo)

    Senior VP of Network Equipment Module Business Unit & GM of Asia

    • Tenure: 6.8yrs
    • Compensation: US$1.26m
  • David Kuo (36yo)

    VP, General Counsel & Corporate Secretary

    • Tenure: 6.1yrs
    • Compensation: US$710.90k
  • Jessica Hung

    VP of Finance & Controller

    • Tenure: 12.7yrs

Board Members

  • Richard Black (85yo)

    Independent Director

    • Tenure: 18.1yrs
    • Compensation: US$175.34k
  • Mike Chen (69yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: US$167.34k
  • Thompson Lin (56yo)

    Founder

    • Tenure: 22.6yrs
    • Compensation: US$4.71m
  • Alex Ignatiev (74yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: US$161.72k
  • Che-Wei Lin (55yo)

    Independent Director

    • Tenure: 5.7yrs
    • Compensation: US$158.72k
  • Alan Moore (58yo)

    Independent Director

    • Tenure: 6.5yrs
    • Compensation: US$161.72k
  • Bill Yeh (67yo)

    Lead Independent Director

    • Tenure: 1.4yrs
    • Compensation: US$169.67k

Company Information

Applied Optoelectronics, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Applied Optoelectronics, Inc.
  • Ticker: AAOI
  • Exchange: NasdaqGM
  • Founded: 1997
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: US$223.723m
  • Shares outstanding: 20.03m
  • Website: https://www.ao-inc.com

Number of Employees


Location

  • Applied Optoelectronics, Inc.
  • 13139 Jess Pirtle Boulevard
  • Sugar Land
  • Texas
  • 77478
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AAOINasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDSep 2013
A59BST (Boerse-Stuttgart)YesCommon StockDEEURSep 2013
0HGVLSE (London Stock Exchange)YesCommon StockGBUSDSep 2013

Biography

Applied Optoelectronics, Inc. designs, manufactures, and sells various fiber-optic networking products worldwide. It offers optical modules, lasers, transmitters and transceivers, and turn-key equipment, a ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/09/16 00:15
End of Day Share Price2019/09/13 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.