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Results: Universal Display Corporation Beat Earnings Expectations And Analysts Now Have New Forecasts
Shareholders might have noticed that Universal Display Corporation (NASDAQ:OLED) filed its third-quarter result this time last week. The early response was not positive, with shares down 3.5% to US$83.92 in the past week. Revenues were US$160m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$1.72, an impressive 51% ahead of estimates. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Universal Display after the latest results.
Taking into account the latest results, the current consensus from Universal Display's nine analysts is for revenues of US$674.7m in 2027. This would reflect an okay 7.5% increase on its revenue over the past 12 months. Statutory earnings per share are expected to shrink 8.4% to US$4.69 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$678.2m and earnings per share (EPS) of US$4.73 in 2027. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
Check out our latest analysis for Universal Display
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$115. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Universal Display, with the most bullish analyst valuing it at US$158 and the most bearish at US$71.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Universal Display's past performance and to peers in the same industry. The analysts are definitely expecting Universal Display's growth to accelerate, with the forecast 5.9% annualised growth to the end of 2027 ranking favourably alongside historical growth of 2.8% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 27% per year. So it's clear that despite the acceleration in growth, Universal Display is expected to grow meaningfully slower than the industry average.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Universal Display's revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Universal Display analysts - going out to 2028, and you can see them free on our platform here.
Before you take the next step you should know about the 1 warning sign for Universal Display that we have uncovered.
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