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Shares of fiber optic components supplier Alliance Fiber Optic Products Inc. (AFOP - Snapshot Report) have continuously been on an upswing since it announced its second quarter 2013 preliminary results on Jul 1. Currently, the shares are trading near its 52-week high of $32.34, which it attained on Jul 11. As the detailed financial results are awaited on Jul 23, we expect the stock to continue its bull run, unless there is any unlikely twist in the tale.

With strong customer demand, Alliance Fiber Optic expects second quarter revenues to be over $19 million, which represent a 55% sequential increase. The latest revenue projection is well above the company’s revised revenue guidance of $16 million provided in May, when it increased its revenue expectations from $14 million provided during the first quarter 2013 conference call.   

The steady improvement in revenue expectations is backed by a solid customer pull for Alliance Fiber Optic products. In order to meet this higher market demand, the company has diligently focused on capacity expansion programs and remains upbeat on achieving strong quarterly results.

The forward P/E ratio of Alliance Fiber Optic is also lucrative at 18.96 with an expected sales growth of 6.97%. The current Zacks Consensus Estimate for second quarter earnings is pegged at 47 cents, which equates to an astounding 235.71% year-over-year increase. The stupendous market expectations are also evident in a 40.36% rise in share prices from $21.88 at market close on Jul 1 (when it released its preliminary results) to $30.71 on Jul 12.    

Headquartered in Sunnyvale, Calif., Alliance Fiber Optic designs and manufactures a broad range of high-performance fiber optic components and integrated modules for communications equipment manufacturers to help them deliver optical networking systems for long-haul, enterprise, metropolitan and last mile access segments of the communications network.

Alliance Fiber Optic currently has a Zacks Rank #1 (Strong Buy). Other companies in the industry worth mentioning include Advanced Micro Devices, Inc. (AMD - Analyst Report), Diodes Incorporated (DIOD - Snapshot Report) and Integrated Device Technology, Inc. (IDTI - Snapshot Report), each carrying a Zacks Rank #1 (Strong Buy).

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