Display and lighting technology developer Universal Display (NASDAQ:OLED) just delivered the kind of earnings surprise that usually sends share prices to the moon. Sales rose 19% year over year to $134 million, leaving Wall Street's $120 million consensus projection far behind. Earnings jumped 35%, landing at $1.08 per diluted share. Here, your average analyst would have settled for $0.79 per share. Universal Display's management held its full-year revenue guidance steady at roughly $565 million, which left many investors wondering what's wrong with the growth trend.

The back half of 2021 suddenly looks less exciting since the solid first-quarter surprise didn't boost the full-year guidance. So Universal Display's stock barely moved on the news and continued to trade more than 15% below February's all-time highs. However, growth-minded investors may want to pick up a few shares of the organic light-emitting diode (OLED) expert for three straightforward reasons.

Hundred-dollar bills strewn across potholes in a long, straight road.

Never mind the potholes, there's a long road ahead. Image source: Getty Images.

1. Sales are just lumpy, not slowing down

Universal Display has a long history of unpredictable results on a quarter-by-quarter basis. A new panel-making partner or a broader range of OLED-equipped phones from one of the larger smartphone makers can give this company a significant boost in any particular period, perhaps followed by a relatively quiet period. In particular, the company is currently expanding its market reach in China, where the quarterly royalties and materials orders can vary wildly from one period to the next.

That's just the nature of being an early leader in a rapidly growing industry. Serious investors should pay less attention to Universal Display's short-term wobbles and focus on the company's long-term future instead. Stale or slumping stock charts like the one Universal Display has right now should be seen as opportunities to buy shares at reasonable prices.

2. It's the early days of a massive addressable market

This company is targeting some enormous end markets. OLED displays started out as an exclusive feature for high-end tablet computers and smartphones but are now moving down to the larger mid-range market. CFO Sid Rosenblatt estimates that about one-third of global smartphone shipments come with Universal Display's OLED screens nowadays.

"We're moving into the low and mid-range with OLED displays in mobile devices," Rosenblatt said on the earnings call. "I think that the addressable market, eventually, we believe, will be the entire smartphone market."

TV sets are another evolving opportunity where OLED screens currently come with premium price tags and high-end sets. But the price difference between OLED panels and LCD screens of the same living-room-friendly size is shrinking thanks to economies of scale in the OLED manufacturing pipeline. The same thinking applies to the PC market, too, from desktop displays to laptop screens. OLED remains a premium option in all of these sectors today, but the panels are moving down the price scale everywhere. Lower prices lead to larger markets, and Universal Display is expanding its addressable markets by leaps and bounds.

A hand points a TV remote at a wall with dozens of TV screens showing different images.

Image source: Getty Images.

3. Universal Display is expanding its horizons, too

And those are just the company's traditional stomping grounds. OLED panels are starting to show up in power-efficient lighting products, across the interior cabin of the new Mercedes EQS electric car, in the taillights of several other car brands, and in Nintendo's (OTC:NTDOY) upcoming Switch Pro consoles.

Universal Display is also boosting the amount of revenue-generating technologies it can pack into each OLED panel. The long-awaited blue OLED elements are getting closer to commercial availability alongside new red, yellow, and green emissive materials. And next year, management expects to have an alpha version of a new manufacturing process that creates OLED panels in a solvent-free process similar to ink-jet printers. That's a big step forward that could help Universal Display's manufacturing partners dramatically scale up their volume of large-panel production.

So the growth is not limited to smartphones and TV screens. Universal Display has a ton of expansion ideas to explore, and I expect that we'll see even more product additions along the way. It won't have to deal with the lumpy nature of small revenue streams much longer. This little company is going places, and the stock price should follow suit.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.