BOE: Near-term panel price outlook remains relatively stable; maintain Overweight

Overview

This report focuses on BOE Technology's panel pricing outlook, OLED shipments, and medium- to long-term supply-demand outlook. Management believes that earlier restocking drove TV panel prices higher over the past few months, and prices should remain relatively stable in Q2 2026; the trend in the second half of 2026 will depend on end-market demand. Macro uncertainty, geopolitical tensions, and rising memory costs may weigh on consumer electronics demand, but supply discipline among major panel makers should help prevent a sharp price decline in a weaker scenario.

Core views

The core view is that TV panel price momentum may slow in late Q2 2026, but BOE still offers relatively attractive investment attributes, supported by its lower valuation, competitive advantages, migration toward higher-end products, and rising OLED penetration across multiple applications. The smartphone display market is bifurcating: flexible OLED is expected to remain more resilient in the mid-to-high end market, a-Si remains competitive in the low-end market, while rigid OLED and LTPS may come under further pressure.

Analysis framework

The report mainly combines management guidance, industry supply-demand judgments, panel price trends, OLED shipment targets, the depreciation cycle, and relative valuation. On valuation, it uses the P/B method, which is considered better suited to reflect BOE's intrinsic value in a cyclical panel industry.

Methodology notes

• Valuation methodPB valuation

  Use 2026e P/B as the base valuation framework

  The report uses P/B valuation because the panel industry is highly cyclical, and this method is considered better able to reflect BOE's intrinsic value and to stay consistent with valuation methods used for other panel makers in Greater China.

• Research modelMorgan Stanley ModelWare

  Source of base metrics

  Unless otherwise noted, the report's metrics are based on the Morgan Stanley ModelWare framework, with some consensus data provided by Refinitiv Estimates.

• Rating systemOverweight

  Relative return rating

  Morgan Stanley's Overweight means that over the next 12 to 18 months, the stock's expected total return is risk-adjusted and above the average total return of the analyst-covered industry.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• BOE Technology (000725.SZ)

  Core covered company

  Strengths

  Relatively cheap valuation, supply discipline supporting prices, progress in premiumization and OLED transition, and room for penetration gains across multiple medium-size OLED applications.

  Weaknesses

  The industry remains highly cyclical, TV panel price momentum may weaken in late Q2 2026, and smartphone demand is affected by rising memory costs.

  Comparison

  The report believes its 1.4x 2026e P/B target multiple is close to the 1.4-1.5x average P/B since 2015 and uses the same valuation method as other panel makers in Greater China.

  Risks

  Industry ASPs below expectations, lower-than-expected G10.5 yields, and slower-than-expected AMOLED ramp-up.

• TV panels

  Main price-cycle variable

  Strengths

  Earlier restocking drove prices higher, and supply discipline should help prevent a sharp price decline.

  Weaknesses

  Price momentum may weaken in late Q2 2026, and the second half depends on end-market demand.

  Comparison

  Compared with a more bearish scenario, the report believes disciplined supply from major panel makers can cushion the size of any price decline.

  Risks

  Weaker consumer electronics demand, macro uncertainty, and geopolitical tensions affecting end-market consumption.

• OLED smartphone panels

  Growth business and structural upgrade direction

  Strengths

  Flexible OLED is expected to perform more resiliently in the mid-to-high end market, and high-end models such as LTPO and foldables are expected to outperform.

  Weaknesses

  The competitive landscape remains challenging, and lower-end solutions such as RAM-less may perform less well.

  Comparison

  High-end OLED solutions outperform low-end OLED solutions, and flexible OLED outperforms rigid OLED and LTPS.

  Risks

  Slower-than-expected overseas brand customer expansion and slower-than-expected AMOLED ramp-up.

Key data

• Report date2026-04-02The report cover shows April 2, 2026 06:30 PM GMT.
• RatingOverweightThe body of the report states Stay OW, i.e. maintain Overweight.
• Latest historical target price5.2The latest entry in the target price history is 1/5/26: 5.2.
• OLED smartphone panel shipment target160 million unitsBOE aims to reach 160 million OLED smartphone panel shipments this year, up from 150 million in 2025.
• 2026e P/B target multiple1.4xThe report considers 1.4x 2026e P/B reasonable, close to BOE's average P/B range of about 1.4-1.5x since 2015.
• Estimated ROE for 2024-20264-6%The report estimates ROE at 4-6% for 2024-2026, close to the average level of about 7% during 2015-2022.

Impact & implications

From an investment perspective, the report leans toward the view that BOE will benefit in the short term from supply discipline and stable pricing, and in the medium to long term from limited new capacity, steady demand growth, and higher OLED penetration. If panel ASPs are better than expected, G10.5 line yields improve, or AMOLED ramp-up is faster than expected, the share price and earnings expectations could be revised higher; otherwise, the stock may come under pressure.

Risks

• Industry-wide ASPs are weaker than expected.
• G10.5 line yields are below expectations.
• AMOLED ramp-up is slower than expected.
• Rising memory costs weigh on smartphone and consumer electronics demand.
• Geopolitical tensions and macro uncertainty affect end-market consumption.
• TV panel prices in the second half of 2026 will still depend on end-market demand.

What to watch

• Whether TV panel price momentum slows in late Q2 2026.
• Whether major panel makers continue to maintain supply discipline.
• How end-market consumer electronics demand performs in the second half of 2026.
• Whether BOE can reach its 160 million OLED smartphone panel shipment target.
• Progress in customer adoption of LTPO, foldable, and other high-end OLED models.
• The speed of penetration gains in automotive, notebook, and tablet OLED applications.
• Whether depreciation peaks over the next two years as management guides and declines more noticeably after 2028.