In terms of margins and inventories, Applied Opto has escaped most of the damage done by the unforeseen crash in demand from its top customer. In a presentation to investors, the CEO went deeper into their manufacturing model and the sources of their competitive advantage. And according to us, there is plenty of evidence not […]
November 20th, 2017 · Comments Off on Applied Opto: Competitive Advantage
November 15th, 2017 · Comments Off on Investors Can Take Some Solace From An Under-Reported Aspect Of The Applied Opto/Amazon Saga
A couple of weeks ago, we asked some tough questions relating to Applied Opto’s big drop in sales to Amazon, its biggest customer. We haven’t got most of the answers, and given client non-disclosure, we probably never will. Nevertheless, we argue that investors can take some comfort from the saga, even if something of a […]
November 9th, 2017 · Comments Off on Datacenter Demand Down, Applied Opto Stock Up?
The whole optical networking sector sold off sharply, to a significant extent on a surprising slowdown from the datacenter sector. Yet the one stock that has the highest exposure to this sector went up. We’ll look at this conundrum, and the broader issue of the datacenter growth. Source: Datacenter Demand Down, Applied Opto Stock Up? […]
November 1st, 2017 · Comments Off on Applied Optoelectronics: When Investing Is Like Gambling
Quarterly earnings can delight or disappoint, or even just confirm expectations, and this is hard to tell in advance. And it’s not just with respect to one’s own expectations, more importantly is what the market expectations were. Management, by building a track record, can take at least some of the guesswork out of this equation. […]
October 26th, 2017 · Comments Off on The $64 Million Question For Applied Opto
Shorts, of which there are plenty in this stock, seemed to have advanced knowledge of Amazon pulling demand, perhaps even before management knew. Yet some of their other claims aren’t on the mark and/or can’t be verified. Despite the shorts being on the mark with their Amazon prediction we see no public data to back […]
August 21st, 2017 · Comments Off on There Is A Bear Case For Applied Optoelectronics But We Can’t See Much Of It
Applied Optoelectronics is a battleground stock with the shorts getting a boost by a surprise softness in Q3 guidance from the company. When parsing the competing narratives, we see little in the Q3 softness for the shorts to rejoice. More specifically, we don’t see any reason for AAOI doing much worse in 100G as it […]
May 9th, 2017 · Comments Off on Applied Optoelectronics: Optical Network Woes? What Optical Network Woes?
Here is another optical networking company that has escaped the concerns about a slowing demand from China. In fact, their business is booming and they’re selling all they can and building out capacity as fast as they can. We think this is a wave that has considerable mileage left. Applied Optoelectronics: Optical Network Woes? What […]