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Samsung confirms Novaled deal; Universal Display still up sharply

  • Samsung (SSNLF.PK) and affiliate Cheil Industries (a maker of OLED materials) are buying German OLED materials/tech provider Novaled for €260M ($347M).
  • Cheil's CEO promises the deal will yield major OLED R&D synergies. Samsung says it's paying ~10x revenue.
  • Universal Display (OLED +13.4%) shares, which dove last week on a Samsung/Novaled report, and partly rebounded after analysts argued Novaled's offerings are complementary, is below yesterday's AH highs, but remain sharply higher in response to its Q2 beat and strong full-year guidance.
  • Universal mentioned on its Q2 CC sales of green host materials (used in newer Samsung phones, including the Galaxy S4) rose 192% Q/Q and over 6x Y/Y to $9M. Likewise, green emitter sales rose 186% Q/Q and over 8x Y/Y to $13.1M. Red emitter sales totaled $3.6M, +25% Q/Q but -29% Y/Y.
  • The company added product mix and price cuts impacted its materials gross margin, and that there could be some additional margin pressure if host materials sales "proportionally grow faster" than emitter sales.
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