My Friend Andy, and OLEDs
By Jared A Levy
From Microsoft (MSFT) to GE, a review of the organic light-emitting diodes business.
Related Symbols: GE, MSFT, PANL
Andy is the type of guy that you just have to respect. A renaissance man, if you will. He works behind the scenes here at ONN.tv in production … editing, camera op, lighting, graphics … you name it, Andy probably does or has done it. A great sense of humor and sharp wit, he’s an integral part of the team.
Yesterday morning, I overheard him talking about OLEDs (organic light-emitting diodes) and then he asked me if I knew who was the world’s largest producer of this technology … I thought it would make a great article.
I believe the obvious core of investing, especially if you are thinking like a Warren Buffett or Peter Lynch, is looking for profitable companies that have a product or line of products/services that will be in demand for a long period of time. Maybe their product or its true potential is not yet recognized by the masses as something great or scalable.
Whatever you choose to buy or sell, I believe you should invest in what YOU KNOW. If you’re comfortable with the underlying fundamentals of a company and understand the way its products and services not only come to the marketplace, but also how demand for those products or services may shake out, you put yourself at a distinct advantage and have an air of confidence when monitoring your trade. You must also be aware of who and what the competition is and what effects they may or may not have on the companies you invest in.
Your confidence and experience levels, along with how the stock has actually been performing, will help you select the best strategy to play.
So back to the OLED. I have to tell you I am a complete geek at heart and have an extreme fascination and appreciation for technology. When Andy started talking OLEDs, it really got me thinking about all the application possibilities and growth potential with this technology.
OLEDs create bright, long-lasting, extremely efficient illumination in a wide assortment of colors. OLEDS differ from LEDs, in that instead of emitting points of light from a single source like a light bulb, OLEDs create uniform light that can be spread across ultrathin sheets of material that can either be flat or flexible.
OLEDs have several advantages over LCDs in that OLEDs can be printed onto any substrate; once this process is improved upon, OLEDs would have a significantly lower cost. OLEDs may eventually be printed on fabric, films, and other flexible and unique substrates that will open the doors to some very cool applications, marketing, etc. Think about Times-Square-type advertising everywhere!
OLEDs also offer a greater range of colors, gamut, brightness, response time, contrast, and viewing angle than LCDs, and unlike LCDs (which must use a backlight), OLEDs can show true black.
Obviously, there are disadvantages, the first being cost, which is extremely high now vs. LCD. There are also lifespan drawbacks, but this is being addressed. Regardless, I agree with Andy that this technology will be huge and its possibilities endless.
Advertising, interior lighting, decorative lighting, cell phones, displays in your home (think Back to the Future II), ceiling tiles that double as light fixtures, and an architectural movement to implement OLED displays into your home and office. TVs that you can roll-up and travel with (great for convention displays). Automotive heads-up displays built into the lower part of your windshield, etc. (I have a big imagination).
So how does an investor partake in this potential? Well that is a tough one. I personally would focus on the companies that are not only manufacturing OLEDs, but maybe also have a history of bringing innovation to the markets.
- Microsoft (MSFT) just launched a 3.3″ OLED media player called the Zune HD. (It looks cool, but I think Apple (AAPL) is the king in this field).
- Toshiba will be producing a ton of OLED panels for cell phones and hopefully economizing the process
- General Electric (GE) projects its first commercialized OLED products will be introduced in late 2010 or 2011.
- GE is developing a roll-to-roll manufacturing process, similar to the way photo film and food packaging are created.
- Eastman Kodak (EK) was awarded a $1.7 Million U.S. Department of Energy Contract to Develop OLED Lighting; the technology was discovered by one of their scientists.
- Universal Display (PANL), which trades on the NASDAQ, has received more than $10 million in government grants over the last five years for OLED development for several applications. Additionally, on August 19th, the company was awarded a $1.65 million, two-year contract from the U.S. Department of Energy (DOE) to demonstrate a thin, highly-efficient, white OLED lighting concept for under-cabinet applications.
- PANL is a world leader in the development of innovative OLED technology for use in flat-panel displays, lighting, and organic electronics for over 15 years.
DisplaySearch projects that OLED display revenues will grow to nearly $18 billion in 2015. While passive-matrix OLEDs are expected to maintain a share of the market, most of this revenue growth is expected to come from active-matrix OLED products including a variety of small-area displays for mobile phones and other consumer electronics applications and the introduction of notebook PCs and OLED TVs during the period.
There are certainly some ideas to explore in a very cool, very interesting technology that may have a very bright future
ON Wed. Oct. 7 2009, I went on air and reccomended it as a long term play here