Please ensure Javascript is enabled for purposes of website accessibility

Why Universal Display Shares Fell 27% in the First Half of 2020

By Anders Bylund – Updated Jul 7, 2020 at 1:00PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The OLED technology expert took the COVID-19 crisis harder than your average stock, thanks to a soaring 120% return in 2019.

What happened

Shares of Universal Display (OLED -2.11%) fell 27.4% in the first half of 2020, according to data from S&P Global Market Intelligence. The stock generally followed the market through the COVID-19 crisis, punctuated by two extra-sharp corrections in January and March.

So what

The technology researcher and materials reseller behind the organic light-emitting diode (OLED) screens found in many smartphones and high-end TV sets charged into 2020 on a full head of steam. The stock more than doubled in 2019 as OLED screens moved deeper into the mainstream and panel-making clients continued to expand their OLED manufacturing facilities.

The coronavirus crisis started throwing roadblocks in front of Universal Display in January when several Chinese panel factories and smartphone-building facilities were closed down due to virus concerns. Share prices fell 14.5% that month.

A young businessman watches a large red arrow crash down through the floor at his feet.

Image source: Getty Images.

The other shoe dropped when the Centers for Disease Control and Prevention issued safer-at-home guidance on March 16. The S&P 500 market index fell 11% that day while Universal Display took an 18% haircut.

Apart from these two events, Universal Display tracked closely alongside the broader market in the first half of 2020.

Now what

Many other smartphone component providers amplified the market's COVID-19 reaction, but not many dipped as low as the OLED specialist. Universal Display's huge gains in 2019 set the stock up for drastic corrections this year when the best-laid plans of mice and men were disrupted by a global health crisis.

That being said, the company's long-term prospects were never at risk, and the stock should rebound from these low prices in 2021 and beyond. This is a great time to buy shares of Universal Display.

Anders Bylund owns shares of Universal Display. The Motley Fool owns shares of and recommends Universal Display. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Universal Display Corporation Stock Quote
Universal Display Corporation
$94.35 (-2.11%) $-2.03

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.