M2M and evidence that Maritime is back on track were the two things I was looking for, and both were solid. New products will provide a little juice to H2 now that GO is available.
Sentiment: Strong Buy
you have to add another (roughly) 25 million shares to your share count the majority of which is related to the warrants that Jacobs has, as well as convert conversions. The good news is that cash has to come in if those warrants are exercised...so while the actual share count goes us (from the 52 million shares you cite) the balance sheet will improve due to the cash that comes in.
I'm not sure when the warrants that Jacobs own expire (I believe they are warrants to purchase 10 million shares at $7.50) but unless they expire in the next year or two, I would predict that they don't get exercised until right before he sells the company...when he leaves, I leave...not because it wont still be a solid company (and maybe still an attractive stock) but he will leave/sell when he thinks that the growth/opportunity is slowing...but hopefully that will be when the PPS is north of $100
how can you not like 49% organic revenue growth ; a 50% increase in EBITDA run rate target by year end, and an acquisition where the seller/CEO is going to come run that division at XPO and will BUY $30 million in stock. The company is also at an inflection point where they can add debt (like they will for this acquisition) and not have to go to the equity markets as frequently.
The management of this company are not working for small option packages, or free stock, they have real skin in the game, so when Brad Jacobs tells you that the acquisition will be "transformational" you believe him!
This stock should take out its 52 week high tomorrow, especially if they confirm that they don't need to raise any equity in the near future.
Sentiment: Strong Buy
agree completely...we all know that a LT contract with LG that puts to rest the issue of a "patent cliff" will be a HUGE catalyst for the stock. So obviously (all things being equal) we would like that contract to be announced TODAY..but alas all things are NOT equal. So we must be patient. The comforting fact to remember, is if LG is currently pay $X per gram of OLED emitters, under any and all LT agreement structures it is virtually guaranteed that LG will pay LESS than $X per gram; and depending upon volumes purchased, that discount could be significant.
So if LG ramps up production volumes without a LT agreement, then the revenue that will accrue to UDC will be substantially more than were a LT agreement be in place. UDC management knows this (and LG management knows this as well) so the negotiating strength is on the side of UDC.
As was noted elsewhere, if such a delay keeps a lid on the stock, then long term shareholders will benefit from the buy back that it is place...the worst thing that could happen would be if UDC were to sign a #$%$ LT deal "just to get the deal done"..."we" have the secret sauce that Samsung LG and others need to produce OLED panels from their multi billion $ investments in fabs and equipment...we can be patient, and we will get rewarded for the patience and for those of us who continue to add shares in an around the $30 level, we will be rewarded even more!!
I don't know QTMM at all, and if not for the postings I would never have heard of it. While I don't think that the stock market is always efficient, I try to piggyback on the backs of "professionals" who back up their opinions with real money. In other words, I didn't need to hire PHDs to tell me that UDC's technology is superior, just seeing the type of money and the capital commitment that SMD put into OLED fabs told me what I needed to know. So it seems to me, if QTMM had the IP to "destroy" UDC or if Quantum Dots were the "next big thing" wouldn't "someone" with superior knowledge (like a Samsung, LG or even UDC) take these guys out? In other words, I can't believe that not only is the stock market so inefficient to assign a $60 million market cap to QTMM but that all of the knowledgeable "players" in the industry are "inefficient" as well.
SEC regulations require that you notify the public if you are going to be presenting to the public. By combining the EPS call and the Oppenheimer conference on the same 8K they are saving themselves the effort of filing 2 separate 8Ks.
I wouldn't try to read anything else into the "pairing" other than to know that Sid is going to be out there "telling the story". Having said that, when Sid spoke at a Cowen conference a month or so ago, that was the first time we heard that the new emitters being sold had patent protection through 2029....so while the presentation given on August 12th is unlikely to be a whole lot different than the ones given in the recent past, it is always helpful to listen closely to the "throw away" comments that are anything but.
was just looking at the list of top holders...If you want to know when OLED will pop hard, figure out when Fidelity decides to come back in. They wee a significant holder a few years back (if I recall correctly), and they like to own A LOT of shares of companies they think will grow for years (TSLA, CMG etc.) SO while I am not sure why they sold in the past, when they decide to BUY, I would wager that they end up owning 10 if not 15% (or a tad under 15%.. they never seem to own more than 14.98% of any company
Sentiment: Strong Buy
The stock will react more to the "outlook" than the Q2 number. For example, if revs and EPS are above $62 million and $0.40 but revenue outlook for the year does not get adjusted, then you might get a relief rally (relief that they didn't miss) but you probably won't get a sustainable pop in the PPS. Given all of the good news (production plans) we have been getting lately, both from SMD and LG PLUS the news from Chinese and lighting producers, I believe odds are high that the 2014 revenue outlook for the company gets boosted by management. We have to remember, however, that management is loath to raise guidance unless its a slam dunk (they have learned what "missing" can do to the stock). So if guidance DOES get raised, you can be assured that it is effectively in the bag. But if it does NOT get raised, that doesn't mean that the revenues won't still beat current consensus. Management has to walk the fine line of adjusting guidance every quarter, or, given the infancy of the industry, staying with annual guidance and not get into the adjustment game.
My personal belief is that Q2 will be so strong that they will have no choice but to raise guidance. Knowing management as I do, I don't think that they will go crazy raising it too high, since they will have another opportunity to adjust it after Q3. The REAL pop we will see on the stock will come when we hear about a long term agreement with LG that runs well past 2018 (he so-called patent cliff). Clearly they will have to announce it as soon as it is signed, but it IS possible that the agreement and the Q results can be announced together (although I wouldn't read anything into it if that does NOT happen)
Captain and Tennielle's famous song was "Love will keep us together"...gotta love UDC
there should be no "$" before their share holdings...in other words, at $30/share they have over $200 million of investor capital invested in OLED...and no, it would make NO sense for them to "play games" with it...SEC regulations require that one publishes all transactions within a set number of days after they occur (when you own over 5% of a company). I'm not sure if it is 5 days or 10, but it is frequent. A shareholder must continue to report intra quarter until he#$%$ falls below 5% In addition, when you own close to 10% of a company, you will get paid both on fundamentals and valuation...and unfortunately UDC (OLED) continues to get penalized on the valuation front due to the volatility of the stock...so while Discovery might want to sell on the ups and reload on the downs, the filing requirement will probably prevent them from even trying...and they sure as heck don't want to ADD to the volatility, since valuation suffers...
All the pieces are lining up for a great Q2 and upping of guidance. There is no reason for the company to come out and "refute" anything; once you get into that game then the next time when you do NOT refute, then people will read into the fact that you did NOT say anything. If the stock was falling because someone was out saying that the Q was bad, and it was indeed bad.....then SEC regs would require that they say something. Finally, we (the shareholders/company) have a stock repurchase program in place, and as was cited above, these plans have self imposed "rules" as to what price, volume % of volume etc. guiding when the shares can be repurchased. So for me, banking on the fact that the Q will be great, I would rather learn that the company had repurchased say $38 million worth of stock at an avg price of say $28.97 than have them try and refute the bozo article on SA. We have to remember, the MAJOR short leg that is left is the (unfounded) fear of a patent cliff, and IMHO the only way to rebut that is to announce a LT agreement w LG that runs through 2020 or so. If you are a short that believes that there WILL be no such agreement, you want to be shorting more stock AFTER the stock has had a strong run. WHile the current price action is frustrating, I firmly believe that it has nothing to do with the fundamentals, and the stock will perform quite nicely both after the Q2 report comes out, and after we get the agreement from LG.
I wonder if people know that Ron publishes OLED-INFO...so he is not some fresh college graduate trying to make a name for himself making outrageous predictions; this is a guy who has forgotten more about the OLED industry than the rest of us know...
I don't think he is "totally wrong"...he misses a few key things and doesn't give any catalysts (ie a long term agreement with LG) but in general it is a positive article...would you rather have a "short driven" totally incorrect article written? :)
the things that jumped out at me with regard to UDC is that while high end smart phone sales held up fairly well (ie good for OLED) the lower end (those without OLED screens) we weak, with sales going to cheaper competitors. Additionally tablet sales were weak. Bit of course that is before the release of the TabS, which we all know is being launched with a strong marketing push. My takeaway from the Samsung results is that the company needs to keep pushing the concept that AMOLED is far superior to LCD screens, since AMOLED is one of the differentiating features for Samsung products...since without such a differentiating feature, Samsung risks getting commoditized.
if there are enough of these sold to move the needle for UDC, we are all in trouble...
my wife has an iPad case that doubles as a keyboard (uses Blue tooth) and its made by Logitech...really works well, so I am hoping that Logitech will have one for the TabS in short order, and I will get one of those....but I will report my "typing" experience on the S after I get it on Monday
A few months ago I pulled my iPad out of my briefcase, and it was underneath a bunch of other stuff...when I finally got it out, I must have flexed it too much and the screen looked like a bullet had hit it...but it continued to work so I didn't replace it. So NOW I have a good excuse to buy a 10 inch TabS which I just did, and it will be delivered on Monday...so I will report in on my impressions (although I am clearly biased to like it considering my OLED holdings)
The reason I explained WHY I needed a new tablet is also to point out that when "flexible" screens become the norm (and that can only happen with an OLED screen) they will become a whole lot more durable, and durability (along with brighter colors, thinner design, better battery life etc.) will become another selling point for OLED screens on anything portable...
tanker is correct in that UDC will make more $ without a LT contract in place, and if UDC were a private company, that might be the strategy to pursue. Thankfully for us, however, UDC is a public company, and in order to be accorded a high multiple on impressive financials a LT agreement is key (ie agree with Troper). We also need to remember that the market likes smooth and abhors lumpy...so the smoother the revenue stream can become (all things being equal) the less likely you will get a "negative surprise" and then the multiple will be better as well. While most people might not realize, UDC would have been hurting big time in 2012 had they not had the kind of deal they actually struck with SMD. The market had hoped that UDC would have a materials and royalty arrangement, but instead UDC ended up with a materials (with minimum purchase requirements) and a license agreement, with the difference of course being that a royalty pays on units actually shipped/sold while the license was/is paid regardless of production. In Q3 of '12 when SMD pushed out production and material sales disappointed (and perhaps held up by min purchase requirements) the stock was slammed, but it would have been a lot bloodier had there been a royalty rather than a license payment coming.
Looking at it a bit differently, assume that WITH a LT agreement LG will represent $1 of 2015 EPS earnings whereas WITHOUT a LT agreement, LG might represent $1.20 of 2015 EPS. I would argue that the market will assign a 30+ multiple with an agreement in place while only assigning a 20+ multiple without one. For the sake of easy math, assume that other customers (including Samsung) represent $1.50 of EPS...so UDC can earn $2.50 WITH and agreement or $2.70 WITHOUT an agreement....if the stock will get a 30 x multiple WITH an agreement, OLED goes to $75 (30x$2.50) but if there is NO agreement and we only get a 20x multiple, then the stock will only go to $54. I'll take $75 over $54.
tanker...I think you merely read his report incorrectly, or maybe you didn't see the actual report and someone passed along bad info. On the first page of the report you will see his (Gabelli analyst) earnings estimates for '14 is 0.92 and then 1.55 for '15 and finally 2.15 for 2016...if you take those numbers, and divide them by the closing price listed on his report of $32.10 you will get a CURRENT P/E for those earnings estimates. In other words, $32.10/$2.15 = (about) 14.7 (not sure why the decimals aren't exact, but they are all close) So he is pointing out how CHEAP the stock is today, since it is only trading at a 14.7 times multiple of 2016 earnings. He arrives at a price target of $66 for NEXT year by combining a higher PE as well as the Gabelli PMV (private market value) that he calculates on Table 2 of his report. Hope that helps clear that up.