IBD rankings are top notch
Checklist Rating
Composite Rating 99 Pass
EPS Rating…99 Pass
RS Rating…99 Pass
Group RS Rating A+ Pass
SMR Rating…A Pass
Acc/Dis Rating B+ Pass
Demand from Chinese data centers (which is why a Chinese CEO is good to have).
http://www.investors.com/news/technology/applied-optoelectro…
5/22/17
Applied Optoelectronics (AAOI) will get a boost from tech companies like Amazon.com (AMZN) and Facebook (FB) that are upgrading data centers to superfast communications for cloud-based services, says Needham & Co., which initiated coverage on the optical parts maker with a buy rating.
…
Applied Optoelectronics is well-positioned in the data-center market, Henderson said in a report. “We expect very strong demand growth over the next several years as the Web 2.0, Big Data, social media and (cloud) companies drive efficiencies through their current and new scaled-out data-center footprints,” he said.
Applied Optoelectronics’ biggest data-center customers are Amazon, Facebook and Microsoft (MSFT), analysts say.
…
Tech firms are upgrading to 100-gigabit-per-second technology in data centers packed with computer servers. They’re upgrading gear that connects server racks to high-speed network switches as well as links between data centers.
“We think Applied Optoelectronics will materially exceed Street estimates in 2017 as the industry rolls through the steep ramp phase of the data comm upgrade to 25/100 Gbps,” added Henderson.
From 6/13/17:
One of the hotly followed fiber optic telecom plays, Applied Optoelectronics (AAOI), had weathered skittishness in the industry’s investors better than some others. The stock rallied 176% from a Jan. 12 breakout to a high June 6.
Shares pulled back and tested the 10-week line, rebounding in strong trade, but not scoring a gain for the day. The stock staged a weak attempt to climb Tuesday, then fell back to close lower.
Unless it moves higher, the stock is not yet offering a buying opportunity. And it’s important here to note that it’s prior basing attempt dived 33%, then recovered without ever offering a valid buy point. So caution, and protecting capital, is the name of the game here — until it becomes clear whether the stock can hold things together to form a proper rebound or a base.
Ranked #1 in its group.
#2 = LITE
#3 = CIEN
#4 = FNSR
#5 = VIAV
EPS Rating 99
EPS % Chg (Last Qtr) 2850%
Last 3 Qtrs Avg EPS Growth 1042%
Qtrs of EPS Acceleration 4
EPS Est % Chg (Current Qtr) 612%
Estimate Revisions
Last Quarter % Earnings Surprise 12.2%
Annual Earnings
3 Yr EPS Growth Rate 90%
Consecutive Yrs of Annual EPS Growth 4
EPS Est % Chg for Current Year 239%
SMR Rating A
Sales % Chg (Last Qtr) 91%
3 Yr Sales Growth Rate 46%
Annual Pre-Tax Margin 10.1%
Annual ROE 12.5%
Debt/Equity Ratio 15%
Very strong stuff but had a great run. Maybe buy a “trial” position like Saul would and watch and learn. After the last week, we might get a decent pull back soon.