OLED: Hold
Published 16 Sep 2026, 16:37 BST. This is the frozen version, not the current recommendation.
Why this assessment was issued
Stored financial statements changed; the revised figures need checking. The model version changed. The published model version has been replaced. Record the new calculation basis even if the rating is unchanged. Neither a positive nor a negative classification meets the stated requirements. Review business evidence, earnings support.
Neither a positive nor a negative classification meets the stated requirements. Review business evidence, earnings support.
Supporting evidence
Borrowing is lower relative to earnings
Net debt / EBITDA: -0.4× for OLED, against 0.0× across 12 comparable peers.
Operating cash covers reported profit
Over the latest four quarters, operating cash was 1.34 times net income. Review receivables, inventory and non-cash charges before judging the gap.
Opposing evidence
The profit margin narrowed
The latest quarterly operating margin was 35.3%, -4.6 percentage points from a year earlier. Compare the sales and margin contributions below.
Year-to-date profit is lower
Across 2 completed quarters since 2025-12-31, net income was 85.3m versus 131.7m in the matching prior-year periods (USD). Check whether the latest quarter changes that direction.
The original scenarios
| Scenario | Sales growth | Profit margin | Model value |
|---|---|---|---|
| Weaker | -17.5% | 29.9% | $76.37 |
| Central | -12.5% | 33.3% | $113.89 |
| Stronger | -7.5% | 36.6% | $160.80 |
Method: Earnings and historical valuation. A sufficiently complete, positive earnings record allows the stock's own P/E history to be used. These scenarios are not probability intervals.
Original assumptions and checks
| eps | 4.13 |
|---|---|
| cash | 120563000.0 |
| debt | 16863000.0 |
| years | 1.212867898699521 |
| growth | -12.52539981756879 |
| margin | 32.24277814759404 |
| profit | 195684000.0 |
| cash_ok | True |
| debt_ok | True |
| growths | [-13.620249092045267, 6.552346681619037, -14.47343890014855, -11.430550543092311] |
| revenue | 606908000.0 |
| downside | 8.606683814217664 |
| leverage | -0.4026590250759111 |
| multiple | 31.438669692453875 |
| free_cash | 220016000.0 |
| buy_hurdle | 24.57776692642939 |
| volatility | 39.15553385285878 |
| history_end | 2026-09-11 |
| reward_risk | 4.217350090523035 |
| annual_years | 5 |
| usable_weeks | 157 |
| history_start | 2023-09-15 |
| history_weeks | 157 |
| financial_date | 2026-06-30 |
| interest_cover | Not available |
| operating_cash | 262187000.0 |
| uncapped_growth | -12.52539981756879 |
| current_multiple | 20.232444929441588 |
| projected_margin | 33.26547476990808 |
| historical_margin | 34.28817139222213 |
Recent price · Passed. Weekly close dated 2026-09-11.
Suitable business model · Passed. Value operating cash flow or comparable earnings; deduct debt and other ownership claims where appropriate.
Four quarters · Passed. Four quarters ending 2026-06-30.
Current financials · Passed. Statements through 2026-06-30; factor prices dated 2026-09-11.
Annual record · Passed. 5 consecutive annual profit margins, including loss years.
Comparable earnings history · Passed. P/E is usable in 157 of 157 weeks. At least 52 usable weeks and 70% coverage are required; excluding too many loss or missing weeks would bias the target.
Earnings and price dates · Passed. Earnings-release EPS $4.13, for four quarters ending 2026-06-30.
Price risk · Passed. Risk uses the latest 52 weekly price changes.
Comparable sales growth · Passed. Growth uses the median of four quarterly year-on-year comparisons.
Positive statement earnings · Passed. Trailing statement profit is positive.
Earnings reconciliation · Passed. Release EPS is $4.13; statement-derived EPS is $4.26. The difference is within the 5% review threshold; this does not prove there are no unusual items.
Statement totals · Passed. The latest four quarters agree with the trailing snapshot within 5%.
Cash and borrowing · Passed. Cash generation, debt and interest-cover figures are available.
Target publication review · Passed. The model estimate is within SM's automatic publication range of one quarter to four times the current price. This is a review threshold, not evidence that the market price is correct.
Policy sm-review-2-research · Model sm-assessment-14-operating-capital · Data 34e59fbef87c.