Nidec (OTCMKTS:NJDCY) versus Universal Display (NASDAQ:OLED) Head-To-Head Review

Nidec (OTCMKTS:NJDCY) and Universal Display (NASDAQ:OLED) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, analyst recommendations, risk and dividends.

Insider and Institutional Ownership

0.2% of Nidec shares are held by institutional investors. Comparatively, 78.2% of Universal Display shares are held by institutional investors. 2.2% of Universal Display shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Nidec and Universal Display”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nidec	$17.12 billion	2.50	$1.11 billion	$0.26	17.27
Universal Display	$650.61 million	6.46	$242.07 million	$4.48	20.06

Nidec has higher revenue and earnings than Universal Display. Nidec is trading at a lower price-to-earnings ratio than Universal Display, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Nidec and Universal Display, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nidec	0	3	0	0	2.00
Universal Display	1	2	3	0	2.33

Universal Display has a consensus price target of $130.60, indicating a potential upside of 45.30%. Given Universal Display’s stronger consensus rating and higher probable upside, analysts clearly believe Universal Display is more favorable than Nidec.

Profitability

This table compares Nidec and Universal Display’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nidec	6.82%	10.15%	5.24%
Universal Display	34.08%	12.34%	11.04%

Dividends

Nidec pays an annual dividend of $0.02 per share and has a dividend yield of 0.4%. Universal Display pays an annual dividend of $2.00 per share and has a dividend yield of 2.2%. Nidec pays out 7.7% of its earnings in the form of a dividend. Universal Display pays out 44.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Universal Display has raised its dividend for 8 consecutive years. Universal Display is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Nidec has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500. Comparatively, Universal Display has a beta of 1.54, indicating that its share price is 54% more volatile than the S&P 500.

Summary

Universal Display beats Nidec on 14 of the 17 factors compared between the two stocks.

About Nidec

Nidec Corporation, together with its subsidiaries, develops, manufactures, and sells motors, electronics and optical components, and other related products in Japan and internationally. The company offers medium- and large-size motors, small-size and precision motors, motor-related products, units and modules, automotive components, mechanical equipment/machine tools, inspection and measuring equipment, electronic devices, sensors, and other products, as well as mold, molding, cutting, and machining components. Its products are used for applications in robotics, IoT products, automotive components, home appliances, logistics/agriculture, information technology, office automation, mobile optical components, medical and health care products, housing equipment, commercial and professional products, industrial machinery, and processing/inspection equipment. The company was incorporated in 1973 and is headquartered in Kyoto, Japan..

About Universal Display

Universal Display Corporation engages in the research, development, and commercialization of organic light emitting diode (OLED) technologies and materials for use in display and solid-state lighting applications in the United States and internationally. The company offers PHOLED technologies and materials for displays and lighting products under the UniversalPHOLED brand. It is also involved in the research, development, and commercialization of other OLED device and manufacturing technologies, including FOLED that are flexible OLEDs for the fabrication of OLEDs on flexible substrates; and OVJP, an organic vapor jet printing technology. In addition, the company provides technology development and support services, including third-party collaboration and support to third parties for the commercialization of their OLED products; and contract research services in the areas of chemical synthesis research, development, and commercialization for non-OLED applications, as well as engages in the intellectual property and technology licensing activities. Universal Display Corporation was founded in 1985 and is headquartered in Ewing, New Jersey.