Applied Opt (AAOI)vsCisco Systems Inc (CSCO)
AAOI
Applied Opt
$114.41
+0.45%
TECHNOLOGY · Cap: $8.85B
CSCO
Cisco Systems Inc
$81.83
+1.20%
TECHNOLOGY · Cap: $319.49B
Smart Verdict
WallStSmart Research — data-driven comparison
Cisco Systems Inc generates 12859% more annual revenue ($59.05B vs $455.71M). CSCO leads profitability with a 18.8% profit margin vs -8.4%. AAOI appears more attractively valued with a PEG of 0.78. CSCO earns a higher WallStSmart Score of 70/100 (B-).
AAOI
Hold38
out of 100
Grade: F
CSCO
Strong Buy70
out of 100
Grade: B-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Intrinsic value data unavailable for AAOI.
Margin of Safety
+37.1%
Fair Value
$130.10
Current Price
$81.83
$48.27 discount
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Revenue surging 33.9% year-over-year
Growing faster than its price suggests
Mega-cap, among the largest globally
Every $100 of equity generates 24 in profit
Strong operational efficiency at 24.9%
Earnings expanding 31.2% YoY
Generating 1.5B in free cash flow
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
Moderate valuation
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 : CSCO
The strongest argument for CSCO centers on Market Cap, Return on Equity, Operating Margin. Profitability is solid with margins at 18.8% and operating margin at 24.9%. PEG of 1.32 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 : CSCO
The primary concerns for CSCO are P/E Ratio, Altman Z-Score.
Key Dynamics to Monitor
AAOI profiles as a hypergrowth stock while CSCO is a mature play — different risk/reward profiles.
AAOI carries more volatility with a beta of 3.27 — expect wider price swings.
AAOI is growing revenue faster at 33.9% — sustainability is the question.
CSCO generates stronger free cash flow (1.5B), providing more financial flexibility.
Bottom Line
CSCO scores higher overall (70/100 vs 38/100), backed by strong 18.8% margins. 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.
Cisco Systems Inc
TECHNOLOGY · COMMUNICATION EQUIPMENT · USA
Cisco Systems, Inc. is an American multinational technology conglomerate headquartered in San Jose, California, in the center of Silicon Valley. Cisco develops, manufactures and sells networking hardware, software, telecommunications equipment and other high-technology services and products. Through its numerous acquired subsidiaries, such as OpenDNS, Webex, Jabber and Jasper, Cisco specializes in specific tech markets, such as the Internet of Things (IoT), domain security and energy management. On January 25, 2021, Cisco reincorporated in Delaware.
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