'baff' pid='81258' datel Wrote:Thanks Admin. It's extra hard to guesstimate what is really going on here. New shorts could mean either that the shorts 'know' about more bad stuff going to happen or that they've been able to successfully sell the short thesis to new gullible traders. After all the shorts need to cover their substantial positions somehow and their best chance is to continue spreading fear, doubt and uncertainty. As usual I'm not selling so they got to convince other shareholders to part with their shares
For me, I'm 90% certain that there is no other bad stuff. There is Amazon, and that could continue for a while, but most of it should be priced in as Amazon is already down to 10% of revenue in Q3. There is nothing in publicly available info to suggest that Applied Opto is losing other customers or can't compete in 100G, or that there is accelerated price erosion, or that their yield on the lasers is low, or any of the other things the shorts have argued.
The 100G market is actually growing very fast, prices are holding up pretty well (per earnings conferences from other companies like Finisar) and Applied Opto is both growing sales of 100G and sales to other companies at a very healthy clip.
So I actually don't think there is more bad news besides the possibility that the Amazon situation might continue for one or two quarters more.
But do I know that for a fact? No, and of course lots of people were surprised by the sudden Amazon demand decline, very much including Applied Opto's management. But not that short guy on StockTwits.