Universal Display’s engineered beat and anticipated guidance raise.

Thursday, November 7, 2013.   On September 6, 2013 Goldman Sachs issued a report announcing that Universal Display Corporation (UDC; Trading Symbol OLED) would beat its analyst earnings revenue and earnings estimates for the third quarter and raise its guidance. UDC is scheduled to announce its third quarter results after the close today. UCD’s analysts’ Consensus estimates for this quarter are revenues of $21.8 million and an earnings per share loss of 5 cents. Yet UDC reported revenues and earnings per share of $49.4 million and 33 cents in the second quarter, its most recently reported quarter. All of UDC’s sales come from the sale of OLED products. OLED product sales rose in the third quarter. One source estimates that sales rose 7% during UCD’s third quarter, which it is about to announce.

UDC’s balance sheet and income statements are simple. Estimating its revenues and earnings should be straightforward. A simple subtraction calculation is all that is necessary to set the base case for this coming quarter’s estimates. Simply subtracting the contractual semiannual payments UDC received and booked in the second quarter that will not come in the third quarter yields straightforward estimates of revenue and earnings per share of $29 million and 3 cents and not a loss, even without taking into account the third quarter increase in sales of OLED products.