What happened

Shares of Universal Display (NASDAQ:OLED), the leader in organic light-emitting diode (OLED) technology for the display and lighting industries, rocketed 43.7% higher last month, according to data from S&P Global Market Intelligence. The stock is up 18.8% over the one-year period through March 7.

For some context, the S&P 500 index returned 3.2% in February and has returned 2.9% over the last year. 

Two-paned image with top pane showing a lit display on a smartwatch on a person's wrist and bottom pane showing a man using a virtual reality headset.

Image source: Universal Display.

So what

Universal Display stock had solid momentum throughout February, which we can probably attribute in part to investors moving money back into highly valued growth stocks starting this year after taking it out of those stocks during the end of last year. 

But the main catalyst for last month's powerful performance was the company's Feb. 21 release of fourth-quarter results that were better than expected. Shares popped 23% the next day and continued to move higher through the end of the month.

In the quarter, revenue declined 39.5% year over year to $70.1 million, and earnings per share (EPS) fell 42% to $0.40, easily beating Wall Street's consensus estimate of $0.29. At the beginning of 2018, Universal Display adopted new ASC 606 accounting standards that changed the way it recognizes license fee revenue. Under the previous ASC 605 standards, revenue would have been $92.9 million (a 19.8% decline) and EPS would have been $0.95 per share (a 37.7% increase).

Check out the latest earnings call transcript for Universal Display.

OLED Chart

Data by YCharts.

Now what

In 2019, Universal Display expects "meaningful growth to resume ... as new OLED capacity comes online, new OLED products are launched, and progress continues with our customers' OLED commercialization plans," CFO Sidney Rosenblatt said in the earnings release.

Management guided for 2019 revenue in the range of $325 million to $350 million, representing growth of 31.4% to 41.5% year over year. Now that's a bright picture.

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