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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Universal Display (Nasdaq: PANL ) surged more than 30% in early trading after news broke yesterday that Samsung had signed a six-and-a-half-year supplier contract with the company.
So what: For years, Samsung had been hedging its bets by signing only three-month extensions. Now, Universal Display can more confidently plan production of OLED technology for use in Samsung screens.
Now what: The deal is also apparently better. Rather than per-unit royalties -- a common risk-reducing measure in the early stages of a supplier relationship -- Universal Display will now be paid an upfront license fee. The implication? The company's OLED technology has proven itself. Don't be surprised if LG Display (NYSE: LPL ) and peer manufacturers agree to similar terms. Do you agree? Would you buy at these levels? Weigh in using the comments box below.
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Report this Comment On August 26, 2011, at 3:10 PM, jtothes wrote:
I couldn't agree more with Tim. They have been making technological breakthroughs and refining their manufacturing processes, which has put them in this great position. I believe they will trading around $60-$65 dollars in the next 6 to 8 months.
Report this Comment On August 30, 2011, at 6:43 PM, manojv wrote:
What's the actual $ amount that this contract will add to their bottom line? Anyone have a clue?
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