Recent insider trends for Applied Optoelectronics, Inc. (NASDAQ:AAOI) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. AAOI’s insider trading patterns have some implications for where the stock might be headed.
Institutions own 77.02% of Applied Optoelectronics, Inc. (AAOI)’s shares. The total value of these holdings, in millions, is $658. Among active positions in the latest quarter, 130 holders increased their positions by a total of 3.97 million shares, 109 holders decreased the positions by a total of 4.98 million shares, and 20 holders held their positions. This works out to a net decrease in ownership of 1.01 million shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 51 holders initiated new positions by a total of 1.74 million shares and 54 holders exited their positions by a total of 1.45 million shares. This nets out to an increase of 294589 shares and is a bullish sign for AAOI.
In the last three months, insiders executed a total of 24 trades. 1 of these were buys and 23 were sells. Insider ownership decreased by a total of 61846 shares, which suggests that AAOI’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 15 buys and 89 sells, and ownership decreased by a net of 143782 shares.
Comparing the number of shares sold short over time is a method analysts often use to get a reading on investor sentiment. Applied Optoelectronics, Inc. (NASDAQ:AAOI)’s short interest is 12.37 million shares, or 73.40% of the float. This represents an increase of 3% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.
Ownership trends and trading patterns can be useful tools for predicting a stock’s performance, but it’s also important to consider the technicals in order to form a more comprehensive view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that AAOI is a sell, which implies that AAOI is expected to underperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that Applied Optoelectronics, Inc. (NASDAQ:AAOI) is overvalued.