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Cash-Rich Stocks to Buy: Universal Display (OLED)

Cash-to-Market Cap: 5.5%

Universal Display Corporation (NASDAQ:OLED) has been at the forefront of a move from light emitting diode (LED) technology to organic light emitting diode (OLED) technology for flat-panel TVs. It finished Q1 2017 with $297.4 million in cash and no long-term debt.

In 2013, I recommended Universal Display stock as one of two small-cap picks to own for the next 20 years. I felt the company, and its 3,000-plus patents worldwide, had the potential to get really big. So far, so good — since my recommendation, OLED is up by more than 240%, with a good chunk of those gains coming in 2017.

Universal Display’s first-quarter earnings announced May 4 were very strong, with revenues and operating income up 87% and 384%, respectively, year-over-year. Management expects fiscal 2017 revenues to be at least $260 million, 30% higher than in fiscal 2016.

“It is an exciting time for the OLED industry. We are encouraged by the momentum that we are seeing from our customers as well as from the supply chain that supports the OLED ecosystem,” said Universal Display CFO Sidney Rosenblatt. “As we look forward, we believe that the OLED industry is poised to grow faster than earlier expectations this year.”

As far as I can tell nothing’s changed to alter my view that this stock’s a keeper.

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