Oppenheimer Remains Sidelined on Universal Display (OLED) as Guidance Cut Amid Samsung Delays
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Oppenheimer analyst Andrew Uerkwitz reiterated a Perform rating on Universal Display (NASDAQ: OLED) as revenues guidance was cut due to delays as Samsung.
Uerkwitz commented, "OLED reported 2Q16 revenues/non-GAAP EPS of $64.4M/$0.46 vs. our $69.5M/$0.51E and consensus of $69.5M/$0.51E. The company reduced its annual revenue target, citing three reasons: 1) delayed adoption of new material (likely by Samsung), 2) lower royalty revenue estimates (likely from LG), and efficiency gain at customers. Samsung's near monopoly on the OLED display market is to blame for such volatility in Universal Display's results, which we expect to remain a key concern for investors as well as OEM customers of OLED displays. Our view is unchanged by 2Q16 results; we recognize that the sizable capacity investments make OLED technology the most exciting topic in the display industry, but we choose to stay sidelined given the company's oversized exposure to Samsung in the near term."
Shares of Universal Display closed at $70.25 yesterday.
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