Universal Display (PANL) Hit on Potential Lost Sales from Largest Customer
Tweet Send to a Friend
Get Alerts PANL Hot Sheet
Up)
Trade PANL Now!
Universal Display (Nasdaq: PANL) shares are getting hit Monday following a positive verdict for Apple in its patent litigation trial with South Korea-based mobile device giant Samsung.
Though the news is a positive for Apple, Universal Display may see a substantial drop in sales due to Samsung being one of its largest customers.
According to Universal Display's latest 10-Q filed with the SEC, sales in the second-quarter from South Korea as a whole were $23.56 million. This amounts to 78.6 percent of Universal Display's total sales in the period.
So, should Samsung see a good portion of its devices banned from import into the U.S. -- a decision is expected on September 20th -- then Universal Display will have to cope with fewer LED/OLED/AMOLED sales. Samsung moved to increase is position in the AMOLED market earlier in 2012 with the spinoff of its LCD business in April and subsequent merger with Samsung Mobile Display Co. Universal Display licenses OLED technology to Samsung.
"The verdict certainly puts 2012 guidance at risk, and may push the
entire OLED opportunity out a year or more as products are redesigned and brands rebuild," said analyst at Canaccord Genuity. "Any push-out of the opportunity is material in our opinion, as the bulk of UDC's value depends on its
ability to monetize OLED adoption pre-2018 when its core patents begin to expire."
On the possibility of Apple utilizing OLED displays, Canaccord said they do not see any near-term indications that this will be the case.
Shares are off over 8 percent with heavy volume Monday.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
Though the news is a positive for Apple, Universal Display may see a substantial drop in sales due to Samsung being one of its largest customers.
According to Universal Display's latest 10-Q filed with the SEC, sales in the second-quarter from South Korea as a whole were $23.56 million. This amounts to 78.6 percent of Universal Display's total sales in the period.
So, should Samsung see a good portion of its devices banned from import into the U.S. -- a decision is expected on September 20th -- then Universal Display will have to cope with fewer LED/OLED/AMOLED sales. Samsung moved to increase is position in the AMOLED market earlier in 2012 with the spinoff of its LCD business in April and subsequent merger with Samsung Mobile Display Co. Universal Display licenses OLED technology to Samsung.
"The verdict certainly puts 2012 guidance at risk, and may push the
entire OLED opportunity out a year or more as products are redesigned and brands rebuild," said analyst at Canaccord Genuity. "Any push-out of the opportunity is material in our opinion, as the bulk of UDC's value depends on its
ability to monetize OLED adoption pre-2018 when its core patents begin to expire."
On the possibility of Apple utilizing OLED displays, Canaccord said they do not see any near-term indications that this will be the case.
Shares are off over 8 percent with heavy volume Monday.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
You May Also Be Interested In
- UPDATE: Crash in American Electric Power (AEP) & NextEra Energy (NEE) Adds to Jitters
- Barrick Gold Corp. (ABX) halted, news pending
- Tesla Motors (TSLA) Taps New 52-Week High
Create E-mail Alert Related Categories
Insiders' Blog, Trader TalkRelated Entities
Canaccord Genuity
Login with Facebook
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
