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Universal Display Corp. (OLED) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Universal Display Corp. (OLED) closed at $206.62 in the latest trading session, marking a +0.34% move from the prior day. This change outpaced the S&P 500's 0.28% gain on the day. Elsewhere, the Dow gained 0.07%, while the tech-heavy Nasdaq added 0.71%.

Prior to today's trading, shares of the organic light-emitting diode technology company had gained 10.78% over the past month. This has outpaced the Computer and Technology sector's gain of 2.34% and the S&P 500's gain of 1.93% in that time.

Investors will be hoping for strength from OLED as it approaches its next earnings release, which is expected to be August 1, 2019. On that day, OLED is projected to report earnings of $0.46 per share, which would represent year-over-year growth of 100%. Our most recent consensus estimate is calling for quarterly revenue of $76.91 million, up 36.97% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.44 per share and revenue of $357.92 million. These totals would mark changes of +96.77% and +44.66%, respectively, from last year.

Any recent changes to analyst estimates for OLED should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. OLED currently has a Zacks Rank of #2 (Buy).

Investors should also note OLED's current valuation metrics, including its Forward P/E ratio of 84.31. This represents a premium compared to its industry's average Forward P/E of 17.74.

Meanwhile, OLED's PEG ratio is currently 2.81. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Electronics - Miscellaneous Components stocks are, on average, holding a PEG ratio of 1.66 based on yesterday's closing prices.

The Electronics - Miscellaneous Components industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 188, putting it in the bottom 27% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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