Silicon Investor - LPL -- leader in World's TV Industry

[IntoOLEDs] Finally ! A turnaround to profitability and a breakout in stock price. It took ...

IntoOLEDs — 5/29/2026 7:33:08 PM

Finally ! A turnaround to profitability and a breakout in stock price. It took WAY longer than I thought but this should now rise nicely. It'll be nice to be able to calculate a P/E for a change LOL

[IntoOLEDs] Wow. Almost 2 years ago and still no turnaround for this company. Down, down i...

IntoOLEDs — 7/25/2023 7:50:32 PM

Wow. Almost 2 years ago and still no turnaround for this company. Down, down it’s gone. Big loser in my account after I held and held having falling in love with my TV and the OLED story. That turned out to be a very expensive TV I purchased! Lol. Still love the picture quality and that remote tho! Still holding….hoping for consolation.

[IntoOLEDs] Buying even more here. Prospects look good on the OLED TV front (and I finally ...

IntoOLEDs — 9/21/2021 3:26:15 PM

Buying even more here. Prospects look good on the OLED TV front (and I finally bought one!) . Love it. The magic remote is great. Anyway, overweighted here but hopeful that stock price will move "efficiently" upward!

[A.J. Mullen] Thanks Andy. I'm long LPL, based on their traction with OLED screens and what I...

A.J. Mullen — 6/24/2021 1:12:00 PM

Thanks Andy. I'm long LPL, based on their traction with OLED screens and what I've read mostly here. I wondered whether some of the sideways motion is due to that the stock is embedded in another market which might not have done as well as US markets. I could only find one Korean index. It didn't seem fully appropriate, but LPL had risen some against it.

[chessboard_andy] I do still have a core and trading positions. Briefly, my view is that this pau...

chessboard_andy — 6/24/2021 10:03:48 AM

I do still have a core and trading positions.

Briefly, my view is that this pause and sideways move has a couple of principal causes:
Chip shortage concerns
Lack of clarity on CapEx for next year
Plus it takes time to digest an oversized move like the oversized 60% jump from December-February. This is a large industrial, so that was a pretty huge move during a time that the s&p was up about 15%. The end point of that move was in the $11.20 neighborhood.

Clear now that the ~$11.20 is a sturdy point of resistance. The ~$9.60 support to ~$11.20 range may last for a while longer, but I am positioned for a break out to the upside. I think the floor is better established than the ceiling for the reasons in your thesis.

Good luck,
Andy

[IntoOLEDs] Hey, Chessboard: Wondered if you still had a position in LPL. I do, and am dis...

IntoOLEDs — 6/23/2021 4:53:17 PM

Hey, Chessboard: Wondered if you still had a position in LPL. I do, and am disappointed in it's performance despite things looking like a turnaround to consistent profitability is clearly in the works. Figured I'd ask if you have any thoughts since no one else seems to be interested in the company.... and I'm getting a little tired of waiting for my thesis to pay off! Thanks. - Bob

[chessboard_andy] Price support tested well. I had picked $11.19 based in part on the 2/19 close, ...

chessboard_andy — 4/29/2021 11:50:15 AM

Price support tested well. I had picked $11.19 based in part on the 2/19 close, but going back the $11.21-11.24 range probably makes even more sense. Regardless, it did go right down to that support and immediately start ticking up.

I have thoughts about the conference call, but limited time to share. A few big-picture take-aways from my OLED-centric perspective:

LGD is basking in the glow of free cash flow and are unlikely to announce much capex to undermine that until after the Q2 report.
They did act pretty quickly to convert some G7 LCD production that was slated to close over to mid-sized IT panel product capacity rather than closing the fabs. I would guess that was an easy decision in light of price increases.
They seem to be pretty pro-active about semi-conductor shortages, but it is an important issue.
The answer related to the potential growth of P-OLED in the automotive space was very interesting and informative to me from a longer term perspective. The life-cycle of those contracts is pretty long and they are ready, willing and able to build spec-d screens under long-term contracts in that market. The development and validation of each spec'd product is apparently a 1-2 year process. The only thing that confused me was that the speaker seemed to thing that OLED dashes are the perfect screens for EVs. Seems like a silly idea to me. Of course Tesla pushed the envelope on the amount of glass in a cock-pit, but that is more tied to IT than EV.
OLED production trending towards profitability. It wasn't discussed, but a lot of this will happen naturally with depreciation. They are working towards optimization while assessing expansion. They expect to continue evaluating at least into Q3.

Anyway I did take extra positions after seeing support. Hoping we hold and move towards $13 and beyond.

[chessboard_andy] Earnings release overnight tonight. The conference call starts at 16:30 KST whi...

chessboard_andy — 4/27/2021 9:04:03 AM

Earnings release overnight tonight.

The conference call starts at 16:30 KST which is 2:30 am CST. HERE is the LINK to the Conference Call.

The run-up to earnings continued through trading today in Korea where they touched a new 52 week high.

I honestly don't expect this conference call to be too interesting. It will certainly be full of good news about pricing and fab utilization rates. It will certainly not give any answers about whether Samsung has contracted to buy OLED panels.

Generally, commentary on CapEx tends to come out around the time of the Q2 earnings release in July. I am hopeful that they may comment on the timing of the additional 30K sheets of OLED capacity that has been previously announced, but even that is likely to be non-committal.

These calls are a pretty hard listen because of all the translating. There is typical evasiveness as to specifics in the name of "maintaining flexibility." I probably won't listen live unless insomnia kicks in.

I have not really looked at post-call stock price reaction, but this run-up has been unprecedented so I am slightly hopeful for a buying opportunity at the previously noted support levels. I can't imagine another candlestick up after all of this run, but I am positioned to take advantage if that does come to fruition.

Andy

[chessboard_andy] Premarket trade: Someone just bout 44,907 at $12.02. That is over >$500K at a p...

chessboard_andy — 4/23/2021 8:45:00 AM

Premarket trade: Someone just bout 44,907 at $12.02.

That is over >$500K at a pretty aggressive price.

[chessboard_andy] Levels of support are looking pretty well defined. ~$11.19; ~$10.86; ~$9.60 Ove...

chessboard_andy — 4/22/2021 3:05:55 PM

Levels of support are looking pretty well defined. ~$11.19; ~$10.86; ~$9.60

Over the last few months, I've been trading aggressively off of the $9.60 support base.

I don't see that working any more because the two levels above look to be getting very firm, and unless some bad news comes out of earnings next week (which seems unlikely), it's a bit hard to imagine a return trip down to $9.60 over the next few months.

I've been zooming in and out of charts. The 3-month daily and the 1-month 30-minute work together to illustrate $11.19 and $10.86 as key support levels. (Charts below)

I won't be surprised by a return to $10.86, but I am now ready and willing to make aggressive bullish trades against that level. I'll likely even initiate some long trades if we approach $11.19 provided the chart shows some support as that level is approached.

I treat these as active trades and manage them carefully. As always, I'm not suggesting anyone follow me.

[chessboard_andy] I found an explanation for the out-sized move. There was an analyst upgrade by K...

chessboard_andy — 4/22/2021 1:48:29 AM

I found an explanation for the out-sized move. There was an analyst upgrade by KB Securities' Jeff Kim

LG Display: Earnings Enter Recovery Phase

Price target raised from KRW24,000 to KRW38,000.

That is a 38% increase in the price target. Trading yesterday closed at KRW24,900 and the stock price is currently hovering around KRW26,500 as the market approaches the closing bell.

6% up on the day.

The US issue closed yesterday at $11.14 which was up 2.2% from Monday.

[chessboard_andy] Up over 5% in Korea. Looking forward to tomorrow's open. As I have noted previ...

chessboard_andy — 4/21/2021 11:36:45 PM

Up over 5% in Korea. Looking forward to tomorrow's open.

As I have noted previously, $11.19 is the current line of demarcation. Today's trading verified it as a resistance point. It looks like we will have a candlestick open well above that level tomorrow morning. (Perhaps over $11.50). Hopefully we can close well above that level. Blue skies above that level. I have called out $12.96 as the next real hurdle, but that level was set so far ago its relevance is a bit dubious. For now, hopping over $11.19 is a great start for continued strength.

Regarding the reason for the overnight jump, I can't find much. Samsung Electronic's Video Display Division Head was questioned about the LG Display Oled Supply Agreement reports while at the World IT Show in Korea which opened 4/21. He did not confirm anything, but merely said that there were no announcements related to OLED at that show. Perhaps there was more nuance discerned by savvy investors coming out of that show.
Samsung Related Article Link

[Cooters] DJ LG Display May Benefit from Stronger OLED Demand in 2021 -- Market Talk 9:29 ...

Cooters — 4/16/2021 10:31:16 AM

DJ LG Display May Benefit from Stronger OLED Demand in 2021 -- Market Talk
9:29 PM ET 4/13/21 | Dow Jones

0129 GMT - LG Display may benefit from stronger-than-expected demand for organic light-emitting diode panels, CAPE Investment & Securities says. The brokerage expects the South Korean flat-screen firm to boost white-OLED production at its Guangzhou plant in China and exceed its annual target for 2021. CAPE also notes that LG's plastic-OLED shipments to North America are unusually strong in 1H and forecasts shipments to the U.S. to rise by 54% in 2021. The brokerage raises its operating-profit forecast for LG Display by 27% this year. It raises the stock's target by 11% to KRW30,000 and keeps a buy rating. Shares are 0.4% higher at KRW24,750.

[chessboard_andy] Thanks for your thoughts. I did end up re-initiating trading positions in late M...

chessboard_andy — 4/7/2021 4:42:11 PM

Thanks for your thoughts. I did end up re-initiating trading positions in late March as the stock seemed to find a support base in the $9.60 range. There were a couple of days where I thought about exiting, but I watched closely and avoided closing the positions.

FWIW, today's price action was very nice and $11.19 really did a very good job establishing itself as a key level. Support for now, and I hope it stays that way.

I'm obviously not encouraging/advising you or anyone to enter at these levels, but it was a very constructive day for the long-sided chart. I trimmed a small fraction yesterday to lock in some of the gains, but I'm still aggressively positioned with ITM call contracts dated primarily in July.

Andy

[Cooters] That is tighter than I would expect, almost no difference as you go out. However...

Cooters — 4/7/2021 12:35:42 PM

That is tighter than I would expect, almost no difference as you go out. However, I think the low price masks those 7.5's are really deep in the money in percentage terms. If they were 75's on a 110 stock it wouldn't look as odd and it would be the same in percentage terms.

I have not re-established any position here, just watching.

[chessboard_andy] Does the time spread for ITM Call Options seem strange? Comparing the $10 calls ...

chessboard_andy — 4/7/2021 12:17:00 PM

Does the time spread for ITM Call Options seem strange? Comparing the $10 calls vs the $7.50 calls show a pretty dramatic difference.

What does the relative lack of spread over time in the $7.50 indicate, and how can the flatness be exploited?

I know that I'm mostly talking to myself on this board, but I thought I would invite thoughts anyway.

One positive note is that the bid-ask is reasonable for all these contracts which indicates better liquidity than we've seen previously.

Chessboard,
Andy

[chessboard_andy] What a beautiful five-day chart: [graphic] The volume spike around 1pm on 3/30 ...

chessboard_andy — 4/6/2021 10:34:57 AM

What a beautiful five-day chart:

The volume spike around 1pm on 3/30 was welcome, interesting and not insignificant in my opinion.

We are right at a new key level. 2/19/21 had an intraday high of $11.24 and we closed at $11.19. We are dancing around that $11.19 line including a 20K share block at 10:18 (a few minutes ago as I type this). This will likely create a new minor resist/support line, so a close above $11.19 would be a great sign and above $11.24 is even better.

As I indicated previously, above these levels it is hard to find resistance until $12.96 (I would not predict a move that high, but the chart just shows clear skies).

Key supports in my view remain $10.44ish and $9.60ish. I did use $9.60 as a trading foundation. Here's the 3-month with lines at $11.19, $10.44 and $9.60.

[chessboard_andy] New Options activity in October $15 & $17.50 [graphic] The $15 call contracts ...

chessboard_andy — 4/5/2021 10:23:28 AM

New Options activity in October $15 & $17.50

The $15 call contracts transaction was around 9:40 and the $17.50 were around 9:45. Both transactions were on the high end of the spread, so if either trade was a sell it was pre-arranged. I was not watching the spreads early on, but it may have been simple buys at the market maker's price. It is a lot of contracts so somebody had to be on the phone to line up parties.

There are no corresponding put-side trades, but who knows what common stock positions and/or trades underlie these options trades.

If they were both buys, it is around $50k to control nearly 120k shares if LPL can break through to blue sky territory.

[chessboard_andy] Candlestick open coming around $10.70. Let's hope to hold $10.45 support all d...

chessboard_andy — 4/5/2021 9:11:09 AM

Candlestick open coming around $10.70.

Let's hope to hold $10.45 support all day. Rather let's hope for a momentum push past $10.86 resistance.

[chessboard_andy] LG Display and Universal Display Corporation Extend Long-Term OLED Agreements T...

chessboard_andy — 4/5/2021 9:05:01 AM

LG Display and Universal Display Corporation Extend Long-Term OLED Agreements

The specific focus is on the TV side of LG's OLED business as noted by Steve Abramson's quote.

“Our close collaboration with LG Display began when CRTs were still the primary display technology for TVs. Fast forward to today, and LG Display is leading the revolutionary path for OLED TVs..."

LG bows out of handset business, bets on mobile solutions

With LGE leaving the handset business, this takes away a natural customer for LGD's small scree production. I don't think the two main articles are related though. On the contrary, the third article points out continued investment in small area production:

LG Display starts investing in OLED for Apple iPad

This is a terrible auto-translate from Google and the news is not well-confirmed. Most interesting is that the rumored line will be in Paju P10 which was built to accommodate G10.5 sized glass. I'm happy they are using the space for expansion, but the huge doors won't be necessary for Gen 6.5 lines.

All-in-all the market is pleased with the news flow, and we are set for a very strong open following two solid sessions in Korea.

Andy

[chessboard_andy] LG Display's OLEDs Go! competition Finalists LG is sponsoring this design compe...

chessboard_andy — 3/29/2021 2:16:58 PM

LG Display's OLEDs Go! competition Finalists

LG is sponsoring this design competition with 46,000 EUR in prize money. Submissions were due by January. Here are the short-listed designs.

Many play off some of the advantages of Flexible OLED displays. Some focus on transparency.

[chessboard_andy] Grrrr. The chart broke down just before 3pm on a 50K share volume spike to the d...

chessboard_andy — 3/18/2021 10:12:29 PM

Grrrr. The chart broke down just before 3pm on a 50K share volume spike to the downside. Once it the stock dropped below $9.60 the slide was not to be stopped. The Korean issue is drifting down overnight as well, so we will have to claw our way back an $9.60-9.65 is a resistance hurdle that will need to be jumped.

I'm not entirely clear on any strong support levels that formed during the stellar ride from, so we will have to watch for where buyers step in with volume. There are levels, but $9.65 was the number I was trading off of. I don't expect an immediate drop, but if it does not regain that level in the next couple of sessions, you may see a downward drift for a while until a catalyst moves it up or down.

[chessboard_andy] $9.65 still seems to be the demarcation line. (First noted as $9.60-9.65 in Janu...

chessboard_andy — 3/18/2021 11:36:23 AM

$9.65 still seems to be the demarcation line. (First noted as $9.60-9.65 in January.)

We traded around that level from 3/4-3/10. We are still teasing that level, but mostly from above.

I'm thinking about entering a couple of long trades with an eye towards a move back towards $10.78. Haven't pulled the trigger yet though.

EDIT: Just dipped my toes into April $10 calls and a silly play on April $12.50 (@$0.04) for grins. There is no market for the May contracts. I did test a bid at $0.55 for the May $10 call, but the ask did not move. July seems too pricey for me at around $1. It's all too thinly traded to really do much.

Perhaps I'll add some common to my core and sell some calls against it when we approach $11. The problem is that selling covered calls won't realize much for the $12.50 strike unless we have a good candlestick above $11.50. Selling the $10 calls will add enough juice to make some sense.

[Cooters] DJ LG Display Could Post 1Q Earnings Beat on Demand, FX Tailwinds -- Market Talk...

Cooters — 3/10/2021 12:41:56 PM

DJ LG Display Could Post 1Q Earnings Beat on Demand, FX Tailwinds -- Market Talk

1:15 AM ET 3/9/21 | Dow Jones

LG Display may post above-consensus 1Q earnings amid brisk demand for flat screens for TVs and IT products, as well as the dollar's strength against the won, Hanwha Investment & Securities says. The brokerage raises its operating-profit forecast for the South Korean flat-screen maker by 28% for the quarter. Hanwha says prices of liquid-crystal-display panels continue to rise and lead the solid earnings growth, while a higher-than-expected USD/KRW is also helping boost income from sales overseas. Hanwha maintains a buy rating on the stock with a KRW31,000 target price. Shares are 0.9% higher at KRW22,300.

[chessboard_andy] Testing support at ~$10.44. A good hold will be very constructive.

chessboard_andy — 2/24/2021 10:13:21 AM

[chessboard_andy] Support and resistance. . . Trading since February 1 has been a very nice, slow ...

chessboard_andy — 2/10/2021 2:53:18 AM

Support and resistance. . . Trading since February 1 has been a very nice, slow upward march with very nice volume. We are now approaching another minor resistance level which I am pegging at ~$10.44. The Korean Issue is up a bit overnight, so we may move back towards blue sky territory tomorrow morning.

~$9.65 offers healthy back-up support, but we may not test it during this cycle. I just spent some time looking at 2018 charts, and from the end of April 2018 through about mid June 2018 we found a temporary support level around $10.40-$10.60. LG Display broke below that support around June 15, 2018, and that level became resistance. That resistance level was tested and confirmed the week of August 20, 2018. LGD marched lower from there. That resistance was not tested again until a couple of weeks ago.

We did trade above $10.45 for a few days as earnings approached. We closed precisely at that level on the day prior to the earnings release, and the pullback after earnings made sense to me. I still see $10.45-10.50 as an important resistance hurdle that we seem poised to cross over. We bounced off of $10.44 Tuesday morning. I am hopeful that we open above $10.45 Wednesday morning and hold that number for the close.

The very good news is that there really isn't much resistance at all between ~$10.50 and ~$12.94. There may be a tiny bit of short term resistance at the $10.86 pre-earnings high, but we only traded there for a blip, and it should not be a big deal.

I'm hopeful for a candlestick up day after another day or two above that $10.45 resistance and defining it as the new support.

Andy

[A.J. Mullen] FWIW JP Morgan have LGD at overweight with a target 30% higher than the current ...

A.J. Mullen — 2/2/2021 1:44:52 PM

FWIW JP Morgan have LGD at overweight with a target 30% higher than the current price. They say OLED will drive sales and note flexible OLED is now profitable, predicting strong earnings momentum and FCF.

[chessboard_andy] I'm still in for my trading and core positions. From a trading perspective, I ...

chessboard_andy — 2/1/2021 4:51:09 PM

I'm still in for my trading and core positions.

From a trading perspective, I feel that the trading action on 1/29 was really pretty good for a down day. The trading basically mimicked the support levels seen on 1/14&15 with some support at 9.62ish and again at 9.45ish. It was a great close on Friday above that $9.62 line of demarcation followed by a nice candlestick and volume today that held up nicely throughout the session.

The fundamental story is more nuanced from me, and I wish the questions on the CC had been more meaningful as to CapEx planning. My core position currently has covered calls at a $12.50 strike sitting on most of it (April strike), and I'm not super inclined to remove them. I have enough exposure at lower strikes out through July to utilize those to re-evaluate and re-enter as that date approaches. (It will also allow me to harvest some long-term gains and avoid some short-term gains I exercise some call contracts rather than trading out.)

Volume and price tomorrow seems particularly important to see if we can get some money flow into the stock for a continued upward march towards $12.50 and beyond.

The July $17.50 action ended today. Playing with my P/L calculator, I still believe this was some sort of a proprietary synthetic long position with the calls bought at ~$0.2 and puts sold at ~$7.35. I will be watching the exit door carefully to see what the fund thinks over time. If the call side gets juicy and moves over $0.5, I would be shocked not to see an unbalanced deleveraging of that side of the trade. Perhaps selling 25-50% of that position. Selling more than that would indicate (imho) an exposure that the $17.50 was not based on any real analysis.

Andy

[Cooters] Took the profit in LPL, that is good enough for now. No current position.

Cooters — 1/28/2021 11:35:42 AM

[Cooters] LG Display May Face Risk of Slower Panel Demand in 2021 -- Market Talk LG Displ...

Cooters — 1/28/2021 11:25:03 AM

LG Display May Face Risk of Slower Panel Demand in 2021 -- Market Talk

LG Display might face the risk of slower demand for flat-screen panels used in TVs and IT products in 2021, as well as possible increased output from Chinese panel makers which could weaken TV panel prices, Nomura says. The Japanese investment bank downgrades its rating to neutral from buy, suggesting less room to rise after the stock surged 80% since July. Still, Nomura expects LG Display to swing to an operating profit on steady revenue growth in 2021. Nomura raises its target price by 19% to KRW25,000. Shares are 0.4% higher at KRW23,000.

[chessboard_andy] Fourth Quarter Results are out. (Linked to the left.) Korean market seems to in...

chessboard_andy — 1/26/2021 9:39:24 PM

Fourth Quarter Results are out. (Linked to the left.)

Korean market seems to indicate that the stellar results are fully priced in and some profit taking is readily apparent.

Not sure that I'll be awake for the call, and I have an early morning scheduled, but the Q&A may be more interesting than usual.

[chessboard_andy] If he were buying the puts, that would be a weirdly polarized and expensive stra...

chessboard_andy — 1/26/2021 4:18:14 PM

If he were buying the puts, that would be a weirdly polarized and expensive straddle. Basically locked into losing at least some of his premium from $10-$25.

If he is selling the puts, he is willing to take a large position at ~ $10.50 effective price in July.

I think effectively this is a synthetic long stock position with a bit of extra bullish juice by striking so far out of the money. Invested $750 per pair of contracts instead instead of $1000 per hundred shares.

I honestly did not see it, which makes me feel a bit aloof. Thanks for pointing it out.
Best,
Andy

[Cooters] Notice an equal activity in the 17.5 puts yesterday and today?

Cooters — 1/26/2021 3:13:31 PM

[chessboard_andy] Someone is still buying the July 17.50 contracts, although the bid recently drop...

chessboard_andy — 1/26/2021 3:08:41 PM

Someone is still buying the July 17.50 contracts, although the bid recently dropped from $0.20 to $0.15.

I admit to a little FOMO, so I just went a little longer going into tomorrow's move. Bought some February $12.50 for $0.12 & $0.15. Also just filled an order for some February $10 contacts at $0.85.

Nothing huge, and I don't have any real conviction. It definitely feels like we have priced in the upcoming strong quarter. I feel ok about the $10 calls because the price I paid is right at the price of today's open.

Of course the premium on the February contracts will be moving towards zero in the morning, so I feel sheepishly foolish, but that $17.50 wager was too tantalizing not to play. I have adequate exposure at the later strikes, but thought I should splash around in the short dated a bit more. (I almost put in a $0.15 bid on the July $17.50, but figured the February $12 was a better way to squander some cash.)

Andy

[chessboard_andy] Earnings Release & CC 1/27/21 at 16:00 KST (01:00 CST) Form 6-K Link via EDGAR ...

chessboard_andy — 1/25/2021 6:46:52 PM

Earnings Release & CC 1/27/21 at 16:00 KST (01:00 CST)

Form 6-K Link via EDGAR

The LG Display IR Event Schedule page will have the direct link to the conference call. Here's the LINK.

These are always done in English and Korean which makes them a plodding exercise to listen to, and they usually refer a lot to staying flexible. Still always worth a listen.

Andy

(This is just a repost from awhile back. The CC link is now up on the IR website.)

[chessboard_andy] Lot of activity in options, particularly July 17.5s. . .First, it wasn't me. I f...

chessboard_andy — 1/25/2021 6:43:06 PM

Lot of activity in options, particularly July 17.5s. . .

First, it wasn't me. I finished closing out the vast majority of my trading positions last Thusday. I am content with positioning through earnings and did not even look today.

For a while there, I felt alone on an island for some of my contracts. The size of the open interest has broadened quite a bit recently but it is still pretty darn thin.

Now someone is truly on an island with that -LPL210716C17.5 position. (Prior open interest was 27 contracts all of which traded on Friday.) Today's volume was 1,416 contracts. Looks to me like somebody decided they were willing to take whatever they could get at $0.20. Buying was pretty consistent with blocks of 40-70 contracts throughout the day. Something funny/fishy happened at 11:13. 40 contracts traded with $0.20 open and close and $0.53 in the middle. All other blips were minor, and the vast majority were buys for $20 per contract.

Assuming there was a bit of tag-along buying, somebody is making a very aggressive $25,000 bet. If we see a spike open above $12, it will be interesting to watch how much if any of that trade is exited in the short term. That will be an indication of someone's conviction of at least approaching those levels over the next two quarterly reports.

There are almost zero contracts trading above the $12.50 strike, and I expect it is going to be very difficult to find a market for those contracts in the short term absent something really fun happening tomorrow. The $0.53 print may have been a random aberration, but I suspect a nefarious print so that the contract range shows $0.17-$0.53 rather than $0.17-$0.23. Even if it wasn't coordinated, careful watching of the order book could have gotten that print.

Andy

[Cooters] Lot of activity in options, particularly July 17.5s. They report overnight tomor...

Cooters — 1/25/2021 2:48:05 PM

Lot of activity in options, particularly July 17.5s. They report overnight tomorrow/Wednesday morning.

[Cooters] DJ LG Displays 4Q Earnings May Beat Market Views -- Market Talk 9:13 PM ET 1/20/...

Cooters — 1/21/2021 9:51:07 AM

DJ LG Displays 4Q Earnings May Beat Market Views -- Market Talk
9:13 PM ET 1/20/21 | Dow Jones

0213 GMT - LG Display's 4Q earnings are likely to beat market views thanks to solid demand for TVs and IT products, Daiwa Capital says. The Japanese investment bank forecasts the South Korean flat-screen maker's operating profit will more than triple in 4Q from the prior quarter and swing from an operating loss during the same period a year earlier. Daiwa says higher prices for liquid-crystal-display panels and increasing shipments of plastic organic light-emitting diode panels are driving solid earnings growth. Daiwa raises the stock's target by 28% to KRW23,000 and retains its outperform rating. Shares are up 9.9% at KRW23,350.

[chessboard_andy] Korean Issue up >8%. [graphic] Today opened above that $9.65 resistance and sta...

chessboard_andy — 1/20/2021 10:38:32 PM

Korean Issue up >8%.

Today opened above that $9.65 resistance and stayed above that level all day with only a transitory test. Unless something weird happens overnight in Korea, we will definitely open above $10, and we should be able to consider $9.65 as a support.

I'm still long with an oversized position, but I lightened significantly Friday-Tuesday and sold some $10 and $12.50 calls against my core position. I was just locking up some trading profits and hoping to find a Fibonacci retracement to add back around $8.85 and possibly $8.35. The move tomorrow is going to reset those levels and the uptrend is fully intact. Oh well; lost opportunity. I still do have some decently sized and un-hedged long trades in place, so I can still enjoy the ride up.

The skies are blue ahead, and it is hard to figure out from the charts where this ends on the upside. I'm not likely to chase with new or added positions without a pullback. I appreciate the pricing power LGD currently has, but it is hard to solve the Capex balance with the currently healthy market. This is not a simple business model. I will add to adjust the ultimate size of my core position based upon CapEx with an eye towards creating barriers to entry within the OLED space. I really don't see Micro-LED as a huge threat for a while especially to the extent that it requires LTPS.

I am agnostic as to whether they scale up multiple lines at the current 2500x2200 substrate size or if they tackle 10.5g glass, but I would like to see them commit to a ramp. (I have a MUCH older and larger stake in OLED, so perhaps that influences my bias.)

For me, the key to the long story is the entry of so many set makers into the OLED television space. As the sole panel supplier, this will give LGD significant pricing power even as they scale up production. Moreover, LGD still has additional efficiencies to gain through MMG implementation and just scaling up the production numbers. As the current lines reach peak efficiency, new lines should be able to benefit from that learning curve. As equipment gets added, the depreciation cost per m^2 of glass should improve as well as synergies for other overhead, packing & shipping, sales and administrative costs.

I will be listening for confirmation of that long story on the conference call coming up in a week.

Chessboard,
Andy

[chessboard_andy] $9.60-9.65 is the new line of demarcation. It was set up as support yesterday, ...

chessboard_andy — 1/15/2021 10:50:44 AM

$9.60-9.65 is the new line of demarcation.

It was set up as support yesterday, and is acting as resistance today.

I had previously projected clear skies to $9.90-9.93, but I can see some rational in the charts for the $9.65 level considering April 2019 peak and some levels in the summer 2018.

It will take several more tests to firm it up as a point I'm confident enough to trade off of, but it does look to me like a semi-important level based on price behavior yesterday and today. I'm hoping that we can break above it without to much hassle over then next couple of sessions so that future tests will be of support rather than resistance. I'd love it if it just happens within the next couple of hours. Testing resistance is not nearly as fun as testing support.

Caveat as always: My chart-reading is not trading or investing advice. I am just noting what I see from my amateur eye. I primarily invest in core positions over long term, but have a hobby of trading around that core for fun and hopefully profit.

Chessboard,
Andy

[chessboard_andy] Block sells absorbed well. New support is $9.60 There was a 45k share block sol...

chessboard_andy — 1/14/2021 1:36:22 PM

Block sells absorbed well. New support is $9.60

There was a 45k share block sold at 11:19 and a 25k share block sold at 12:42. Those are very large trades, and I never really understand why someone would sell in that size chunk without some sort of agenda to push the price down. It could just be lazy money-managers taking profit, but I often think it is someone trying to push the price to benefit a hedged position.

You expect to see volume like that at open and close, but mid-day is always suspect to me.

In any event, LPL did a stellar job absorbing those trades and bouncing back up immediately into today's trading range.

The trend has been ticking up on better volume as we approach close, and I am looking for that to happen again today. Honestly, any close above $9.60 is great, but above $9.73 is fantastic and $9.75 would be stupendous. (The stock opened today at $9.75 and the first minute saw a low of $9.6 and close of 9.73, so any of those levels represent closing well in my eyes.)

Holding $9.60 will create a new support level, and it survived its first two tests with the block sells referenced above.

zoomed in to remove compression artifacts:

The first block sell pushed down to 9.64 and the second pushed down to 9.60. In both cases recovery was immediate and pronounced.

[MickMook] A little over 5 years ago, I took a position in LPL hoping that it would somewha...

MickMook — 1/14/2021 1:28:34 PM

A little over 5 years ago, I took a position in LPL hoping that it would somewhat track the performance of OLED. After 5 years of disappointing performance (mostly being underwater), I decided to double down in late July when we bottomed out at 5.15. Needless to say, I'm very happy that my holding has turned from a long-standing red to a very bright green!

[chessboard_andy] Korea Market Issue up 5.13%. Fun open coming. [graphic] Pre-market bid 12.5k ...

chessboard_andy — 1/14/2021 8:28:04 AM

Korea Market Issue up 5.13%. Fun open coming.

Pre-market bid 12.5k shares @ $9.59

[chessboard_andy] Nice close today. Volume was tepid most of the day, but it picked up a bit in th...

chessboard_andy — 1/12/2021 4:19:48 PM

Nice close today. Volume was tepid most of the day, but it picked up a bit in the last 10 minutes and was dominated by the buy side.

The most interesting news out of CES (IMHO) was the proliferation of sizes including an announced 42" television and 32" high-end computer monitor. There were statements that more monitor sizes were coming in the 20-30 inch range. The spokesperson seemed to indicate that this was from the WOLED process and not from their small-screen P-OLED lines. As RGB production scales up in size and WOLED scales down, it will be interesting to see the meting point.

WOLED production efficiency is greatly enhanced though MMG (multi-mode mother glass) which allows LG to utilize the entire substrate by producing multiple sizes on the same glass. My assumption is that these smaller sizes are largely a function of that efficiency and will share space with 77", 83" and 88" displays on the same substrate. As found with the 48" screens, that does lead to a limited supply and a very low marginal cost to LG. That makes these screens extremely profitable.

When we get to the earnings call, my primary focus in listening will be on expanded MMG implementation as well as CapEx commitments going forward.

[chessboard_andy] Earnings Release & CC 1/27/21 at 16:00 KST (01:00 CST) Form 6-K Link via EDGAR ...

chessboard_andy — 1/4/2021 9:22:31 AM

[Cooters] Exited my July trade, more of a macro call than LPL specific.

Cooters — 12/31/2020 10:00:40 AM

[A.J. Mullen] Piece on LG's mini-LEDs, bbc.com. Deep blacks aren't as good as OLED and resolu...

A.J. Mullen — 12/30/2020 6:18:14 PM

Piece on LG's mini-LEDs, bbc.com. Deep blacks aren't as good as OLED and resolution probably not be quite as good as micro-LEDs, but the sets will likely be cheaper.

[Cooters] LG Display May Benefit From Strong LCD Demand, Supply Shortage -- Market Talk 1...

Cooters — 12/30/2020 10:41:02 AM

LG Display May Benefit From Strong LCD Demand, Supply Shortage -- Market Talk

1:04 am ET December 30, 2020 Dow Jones

0604 GMT - LG Display may benefit from stronger-than-expected demand for liquid-crystal-display panels, a global supply shortage of which will likely continue through 1H 2021, SK Securities says. A recent power outage and supply disruption at Nippon Electric Glass in Japan is also straining the LCD supply chain, which could favor the Korean flat-screen maker, the brokerage says. SK Securities also expects the company to enjoy solid demand for plastic organic-light-emitting-diode for iPhone 12 smartphones through 2021. The brokerage raises the stock's target by 26% to KRW24,000 and maintains its buy rating. Shares are 0.3% higher at KRW18,650.

[chessboard_andy] I just bought back 10 January 7.5 contracts at $0.95. I wanted to test the premi...

chessboard_andy — 12/29/2020 2:41:01 PM

I just bought back 10 January 7.5 contracts at $0.95. I wanted to test the premium structure as we bounced around between $8.41 and $8.42. The contract was back to a dead bid at $0.85 ($0.06-.07 below par), so I felt the need to probe. I'm definitely fine with the execution, but would have preferred a couple of other buyers matching my bid and just keeping the spread above par. I won't keep adding.

Volume is nowhere today. Hoping to see a little pick-up in volume at close and a nice little candlestick open tomorrow at ~$8.75. I don't mind seeing $8.48 acting as resistance today given the overall lack of volume and the downward pressure of the broad market.

A Santa rally tomorrow would be a lovely thing.

Andy

Edit. Changed my mind and entered a market order for 10 more contracts. Executed at $0.89 (a penny or two BELOW par.) Not sure whether to add more. I am still loving the trade, but I don't want a crowded exit. I will be looking at later dates and maybe increase positions further out, but I may just add more January. I'm not sure what I'm missing, but I see much better support to protect that downside than resistance to block the upside of this short-term trade.

[chessboard_andy] Impossible to know for sure, but it looks like someone may have simultaneously b...

chessboard_andy — 12/29/2020 12:47:29 PM

Impossible to know for sure, but it looks like someone may have simultaneously bought 100 contracts of January 7.50 for ~$1.10 and sold the July 10.00 for ~$0.60. Net debit of $0.5 per contract.