Universal Display Teams With EMT To Expand Presence In China
Zacks Investment Research | Aug 23, 2019 02:36AM ET
Universal Display Corporation (NASDAQ:OLED) recently declared partnership with China-based OLED materials supplier, Eternal Material Technology Company (“EMT”).
Per the terms of the latest OLED host partnership, EMT will manufacture and sell Universal Display’s green, red and yellow host materials to select panel manufacturers based in China. However, financial terms of the deal have been kept under wraps.
Markedly, EMT specializes in volume production and sale of OLED stack materials in China, which favors prospects of the new alliance. Moreover, EMT began construction of OLED materials production in Hefei facility in 2018 with capacity of about 15 tons. EMT anticipates the facility to be operational in 2021.
Management is aiming to address higher demand for OLED materials from China-based clientele with this partnership. Notably, Universal Display is leaving no stone unturned to enhance its phosphorescent emitters with breakthrough research and development (R&D) on its yellow, red and green host materials.
We believe that local partners with complementary business lines will expand Universal Display’s market reach. This will enable the company to analyze demand and pricing parameters effectively. Universal Display is expected to strengthen its presence in OLED industry with similar deals aimed at commercializing OLED host materials.
Strategic Growth Initiatives Boost Optimism
Universal Display is benefiting from robust adoption of its OLED materials, green emitters and red emitters. Moreover, rising demand from panel makers in China is a tailwind. These factors have propelled the company to raise guidance for 2019. Further, synergies from Adesis acquisition are a key positive.
The strong demand fundamentals amid trade-war headwinds and significant presence in OLED industry are boosting investors’ confidence in the stock. Notably, shares of Universal Display have returned 126.5% on a year-to-date basis compared with the Zacks Investment Research
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