Applied Opt (AAOI)vsLumentum Holdings Inc (LITE)
AAOI
Applied Opt
$114.41
+0.45%
TECHNOLOGY · Cap: $8.85B
LITE
Lumentum Holdings Inc
$777.17
-3.09%
TECHNOLOGY · Cap: $57.26B
Smart Verdict
WallStSmart Research — data-driven comparison
Lumentum Holdings Inc generates 362% more annual revenue ($2.11B vs $455.71M). LITE leads profitability with a 11.9% profit margin vs -8.4%. AAOI appears more attractively valued with a PEG of 0.78. LITE earns a higher WallStSmart Score of 69/100 (B-).
AAOI
Hold38
out of 100
Grade: F
LITE
Strong Buy69
out of 100
Grade: B-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Intrinsic value data unavailable for AAOI.
Margin of Safety
-255.6%
Fair Value
$161.46
Current Price
$777.17
$615.71 premium
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Revenue surging 33.9% year-over-year
Growing faster than its price suggests
Revenue surging 65.5% year-over-year
Earnings expanding 71.1% YoY
Large-cap with strong market position
Every $100 of equity generates 29 in profit
Growing faster than its price suggests
Areas to Watch
Trading at 11.7x book value
0.0% earnings growth
ROE of -7.9% — below average capital efficiency
Negative free cash flow — burning cash
Premium valuation, high expectations priced in
Trading at 65.5x book value
Distress zone — elevated risk
Comparative Analysis Report
WallStSmart ResearchBull Case : AAOI
The strongest argument for AAOI centers on Revenue Growth, PEG Ratio. Revenue growth of 33.9% demonstrates continued momentum. PEG of 0.78 suggests the stock is reasonably priced for its growth.
Bull Case : LITE
The strongest argument for LITE centers on Revenue Growth, EPS Growth, Market Cap. Revenue growth of 65.5% demonstrates continued momentum. PEG of 0.97 suggests the stock is reasonably priced for its growth.
Bear Case : AAOI
The primary concerns for AAOI are Price/Book, EPS Growth, Return on Equity.
Bear Case : LITE
The primary concerns for LITE are P/E Ratio, Price/Book, Altman Z-Score. A P/E of 232.5x leaves little room for execution misses.
Key Dynamics to Monitor
AAOI profiles as a hypergrowth stock while LITE is a growth play — different risk/reward profiles.
AAOI carries more volatility with a beta of 3.27 — expect wider price swings.
LITE is growing revenue faster at 65.5% — sustainability is the question.
LITE generates stronger free cash flow (51M), providing more financial flexibility.
Bottom Line
LITE scores higher overall (69/100 vs 38/100) and 65.5% revenue growth. Both earn "Strong Buy" and "Hold" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Applied Opt
TECHNOLOGY · COMMUNICATION EQUIPMENT · USA
Applied Optoelectronics, Inc. designs, manufactures, and sells various fiber optic networking products globally. The company is headquartered in Sugar Land, Texas.
Lumentum Holdings Inc
TECHNOLOGY · COMMUNICATION EQUIPMENT · USA
Lumentum Holdings Inc. manufactures and sells optical and photonic products in the Americas, Asia-Pacific, Europe, the Middle East, and Africa. The company is headquartered in San Jose, California.
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