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Universal Display Corp. Message Board

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  • nofoodinbeard nofoodinbeard Feb 16, 2011 9:24 PM Flag

    Most overbought stock on nasdaq

    Maybe 50 or 60 million in rev next year and a 1.5 billion market cap. Sorry. This is a bubble waiting to pop.

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    • Another poster put it to numbers better than I could just the other day:

      "Samsung would not build the factory if they didn't believe they could achieve a high utilization rate. So let's assume that it is 80% utilzed and that UDC gets 20 cents per screen. Assuming an ASP of $20.00, take a look at Samsung and Apple's component costs, that is only one percent (1%) of ASP.

      24,000,000 x .20 = 4,800,000 per month or $57,600,000 per year.
      Two colors should be no less than .40 per screen or $115,200,000 per year.

      For the year ended 12/31/09, the last fully reported year PANL's total costs were approximately $36,000,000. Looking at the 2010 quarterly reports a more "fair" annual expense is probably about $40 to $45 million.

      That leaves a net income of no less than $12.5 million dollars for one color to Samsung only and approximately $70 million for 2 colors.

      With approximately 38.5 million shares outstanding, the income is somewhere between .32 and $1.82 per share.

      A P/E multiple of 30 (mirroring that of CREE) puts the share price in a range of 10 to 55.
      At 100% utilization the stock price is as high as $77.

      Now, let's reasonably assume that LG, AUO etc. match Samsung's production, and mirror the royalty rate. The same calculation puts the stock price between $145 and $190.

      I submit that the PE of 30, for the growth that will come is actually low and does not fairly represent the pricing that would come with exponential growth and maybe the company's most valuable product line, white light not yet factored in. If we bump the PE to only 40
      the stock price ratches up to as high as $253.

      Now, who would want to be short?"

      feel free to point out where you think he's missed the boat with his reasoning. Since you're probably not familiar with PANL since you're only here to bash I'll inform you that he's referring to Samsung upping production of OLED screens from 3 million/month to 30 million/month, and when discussing colors is referring to Samsung currently purchasing red material from PANL, and that they are expected to begin buying and using green as well.

      So let's hear your rebuttal of the numbers he stated above....

    • You don't have to apologize for being a moron. Seriously the reason the shorts have been absolutely hammered is that they have limited themselves(as has Schwab's Chicago Analytics F rating - Thanks to Mr. Mortimer) to Stock screens that only look backward and have no ability to read the news and project based on pipelines(as you would with Biotech Phase III approval/manufacturing agreements)... You can't slice this traditionally and if you do you'll be getting your favorite call from your broker---liquidate to def...

 
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