Needham & Company Downgrades Applied Optoelectronics (AAOI) to Hold
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Needham & Company analyst Alex Henderson downgraded Applied Optoelectronics (NASDAQ: AAOI) from Buy to Hold.
The analyst comments "With AAOI trading above our prior $9.00 Price Target, we do not have enough conviction to increase the target and retain the rating. Further, we think the $35 million At the Market Offering (ATM) represents overhead supply that reduces the upside. We think AAOI will tread water through the next several quarters until some visibility to 400G orders develops in the late Summer. AOI noted on its call the inventory correction in Data Center transceivers at several of its key customers is likely to persist at least through CY1Q. The lower Revenues after a surge in the Summer of last year is adding pressure to the company's Balance Sheet and forcing the use of equity to support investments and to offset the burn."
Shares of Applied Optoelectronics closed at $9.02 yesterday.
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