Applied Optoelectronics (AAOI) Surges 15.8%: Is This an Indication of Further Gains?
Applied Optoelectronics (AAOI) shares ended the last trading session 15.8% higher at $7.03. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 123.2% gain over the past four weeks.
Applied Optoelectronics extended its rally, driven by its robust optical networking technology portfolio which continues to strengthen its presence in the cable TV (CATV) market. Additionally, growing demand for the company’s 100G products is benefiting its datacenter business, which remains a positive.
This maker of fiber optic products used by cable TV providers is expected to post quarterly loss of $0.28 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $45.43 million, down 13.1% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Applied Optoelectronics, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on AAOI going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Applied Optoelectronics is a member of the Zacks Electronics - Semiconductors industry. One other stock in the same industry, Cirrus Logic (CRUS), finished the last trading session 2.3% lower at $79.33. CRUS has returned 5% over the past month.
For Cirrus Logic , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.41. This represents a change of -63.4% from what the company reported a year ago. Cirrus Logic currently has a Zacks Rank of #4 (Sell).
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