Amid Virus Concerns, OTT Video Trends Positive for Universal Electronics, Says Analyst

Recent design wins, a higher proportion of software content, opportunities in new markets and potential for recurring revenue are positives for Universal Electronics, Inc. (UEI) wrote Dougherty & Co. analyst Steven Frankel in a Tuesday investor note before the company’s Thursday earnings report. That’s despite a 15 percent retreat for the stock over the past few weeks, likely due to coronavirus worries, with 40 percent of the company’s manufacturing based in China, said Frankel. Universal is “still in the early innings of a powerful product cycle,” he said, maintaining a “buy” rating on the stock. Questions remain, though, including the impact of the “fluid” coronavirus situation on the supply chain. Dougherty sees opportunity in emerging subscription broadcast-provided platforms such as Comcast Flex, with MVPDs appearing to be readying over-the-top devices aimed at the growing base of internet-only subscribers, said Frankel, citing Flex’s use of a voice remote supplied by UEI. The analyst also referenced UEI’s new security offerings launched at CES aimed at the hospitality space.