What happened
Shares of Universal Display (OLED +0.22%) gained 206.7% in 2017, according to data from S&P Global Market Intelligence. The gains were largely built on strong financial reports, with a side order of new business from Apple (AAPL +2.65%).
So what
The researcher of organic light-emitting diode, or OLED, technologies reported earnings four times last year. Each report crushed Wall Street's estimates across the board, and the stock recorded doubled-digit gains the next day on all four occasions. The first-quarter report in May led the way with a 24% single-day jump.
Along the way, it slowly became obvious that Apple was planning to include an OLED screen in at least one of last year's new iPhone models, adding more fuel to the fire. Sure enough, the iPhone X shipped with a large OLED screen. That's obviously a big win for this company, and for OLED adoption in general, and that announcement cemented the gains from earlier speculation.
OLED lighting panels like this prototype are about to go mainstream. Image source: Universal Display.
Now what
Here at the start of 2018, Universal Display is busy hammering out a new multiyear contract with largest customer Samsung (NASDAQOTH: SSNLF), replacing a six-year deal that expired at the end of 2017. Universal Display arguable holds more of the cards this time around, and I expect the new agreement to tilt further in the company's favor.
OLED panels are making their way into the enormous market for everyday lighting products, and large-screen OLED televisions are going mainstream with rising sales volumes. On top of all that, Universal Display is getting closer to solving the limited lifetime problem in blue OLED elements and developing solutions for more layers of the OLED technology stack.
2017 was a big year for Universal Display and its investors, but there's lots of room for further growth in the years ahead. Stay tuned.
