Universal Display Q1 Beats Estimates
Universal Display Corp. came out with quarterly earnings of $0.80 per share. It has, in fact, beaten the Zacks Consensus Estimate of $0.68 per share in the stock market. This compares to earnings of $0.66 per share in 2019, with figures adjusted for non-recurring items.
This quarterly report represents an earning of 17.65%. A quarter ago, this company, specializing in organic light-emitting diode technology, expected to post earnings of $0.72 per share. It actually produced earnings of $0.68, delivering a surprising -5.56% loss.
Over the last four quarters, it has surpassed consensus EPS estimates three times.
Universal Display, which belongs to the Zacks Electronics-Miscellaneous Components industry, posted revenues of $112.28 million. This was for the quarter ending in March 2020, surpassing the Zacks Consensus Estimate by 9.03%.
A year ago, the revenue was $87.77 million. Moreover, the company has topped consensus revenue estimates four times over the last four quarters.
Furthermore, the sustainability of the stock’s immediate price movement will mostly depend on management’s commentary on their earnings call. This sustainability is based on the numbers released recently and future earnings expectations.
Universal Display stocks lost about 28.9% since the beginning of 2020 versus the S&P 500’s decline of 11.8%.
Universal Display’s Next Moves
The Universal Display has underperformed in stock trading so far this year. The question investors would ask is: what’s next for the stock?
One reliable measure that can help investors with their curiosity is the company’s earnings outlook. This includes the current consensus on earnings expectations as well as how these have changed.
Empirical research presents a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions on their own, or rely on a tried-and-tested rating tool like the Zacks Rank. This has an impressive track record of harnessing the power of earnings estimate revisions.
The estimate revisions trend for Universal Display was favorable ahead of the earnings release. The magnitude and direction of estimate revisions could change following the company’s newly-released earnings report. The current status translates into a Zacks Rank #2 (Buy) for the stock.
Stocks may outperform the market in the near future. The current consensus EPS estimate is $0.43 on $86.48 million in revenues for the coming quarter. Moreover, analysts expect $3.17 on $438.36 million in revenues for the current fiscal year.
Investors should be mindful that the outlook for the industry can have a material impact on stock performance. The Zacks Industry Rank, Electronics – Miscellaneous Components is currently in the top 47% of the 250 plus Zacks industries. The top 50% of Zacks-ranked industries are outperforming the bottom 50% by a factor of more than 2 to 1.
