UPDATE: Applied Optoelectronics with Overweight Rating, $15 PT as Strong Position in Key Markets Drives Industry-Leading Growth

In a report published Monday, Piper Jaffray analyst Troy D. Jensen initiated coverage on

with an Overweight rating and $15.00 price target. In the report, Piper Jaffray noted, “We are initiating on AOI with an Overweight rating and $15 price target based on 15x our CY14 operating income assumption plus cash. In our view, AOI remains one of the top small cap optical stocks offering exposure to several key growth markets including Cable TV, Fiber-to-the-Home and Data Center Optics, which Ovum Limited estimates as a $2.2B total addressable market. Over the last three years, AOI has outpaced the broader optical industry, having grown revenue at a 36% CAGR, well ahead of the peer group. Through differentiated technology, effective go-to-market strategy and a diversified tier-1 customer base, we believe the company is well positioned to continue this industry leading growth trend moving forward. With impressive revenue growth, expanding margins and favorable valuation, we recommend owning shares of AAOI.” Applied Optoelectronics closed on Friday at $11.01.