Trade-Ideas LLC identified

Applied Optoelectronics

(

AAOI

) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Applied Optoelectronics as such a stock due to the following factors:

  • AAOI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.8 million.
  • AAOI has traded 184.881000000000000227373675443232059478759765625 options contracts today.
  • AAOI is making at least a new 3-day high.
  • AAOI has a PE ratio of 41.
  • AAOI is mentioned 0.48 times per day on StockTwits.
  • AAOI has not yet been mentioned on StockTwits today.
  • AAOI is currently in the upper 20% of its 1-year range.
  • AAOI is in the upper 35% of its 20-day range.
  • AAOI is in the upper 45% of its 5-day range.
  • AAOI is currently trading above yesterday's high.

TST Recommends

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in AAOI with the Ticky from Trade-Ideas. See the FREE profile for AAOI NOW at Trade-Ideas

More details on AAOI:

Applied Optoelectronics, Inc. designs and manufactures optical communications products for Internet data center, cable television (CATV), and fiber-to-the-home markets. AAOI has a PE ratio of 41. Currently there are 5 analysts that rate Applied Optoelectronics a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Applied Optoelectronics has been 390,600 shares per day over the past 30 days. Applied Optoelectronics has a market cap of $298.8 million and is part of the technology sector and electronics industry. Shares are up 76.1% year-to-date as of the close of trading on Monday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Applied Optoelectronics as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.

Highlights from the ratings report include:

  • AAOI's very impressive revenue growth greatly exceeded the industry average of 10.4%. Since the same quarter one year prior, revenues leaped by 52.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • APPLIED OPTOELECTRONICS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, APPLIED OPTOELECTRONICS INC increased its bottom line by earning $0.29 versus $0.00 in the prior year. This year, the market expects an improvement in earnings ($1.25 versus $0.29).
  • Powered by its strong earnings growth of 216.66% and other important driving factors, this stock has surged by 31.56% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
  • 38.09% is the gross profit margin for APPLIED OPTOELECTRONICS INC which we consider to be strong. Regardless of AAOI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 12.26% trails the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.52, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.05 is sturdy.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.