Applied Optoelectronics: Momentum Is Real, And Estimates Still Look Too Low

Cyn Research760 FollowersFollow5ShareSavePlay(9min)CommentsSummaryApplied Optoelectronics is executing into a very strong demand backdrop, and I believe current estimates may still be too conservative given the recent order momentum.Since March 9, the company has announced an initial 1.6T order worth over $200M, followed by more than $124M of 800G orders from one hyperscale customer.The broader market is also moving in AAOI’s direction, as NVIDIA and Broadcom continue to signal that optics are becoming increasingly critical to AI infrastructure.The stock has already run hard, so this is not a low-risk setup. Dilution, high beta, and geopolitical pressure remain important risks. FactoryTh/iStock via Getty Images Introduction Applied Optoelectronics, Inc. (AAOI) has been one of the stronger performers in the market this year, with the stock up nearly 3x while the S&P 500 is down more than 3%. Applied Optoelectronics isThis article was written byCyn Research760 FollowersFollowHi! I'm a passionate investor who has been researching publically traded companies for over 6 years. My primary focus is on identifying great businesses at reasonable prices and holding them for the long term but I also dive into trend following strategies from time to time. While I have a slight bias toward technology companies, I maintain a broad perspective, including opportunities in crypto. I take a global approach to investing, occasionally seeking value beyond the U.S. market. Thanks for reading!Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in AAOI over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.