We recently published a list of 10 Best Mid Cap Tech Stocks to Buy Now. In this article, we are going to take a look at where Universal Display Corporation (NASDAQ:OLED) stands against other best mid cap tech stocks to buy now.

In an interview with CNBC, Thomas Martin, the Senior Portfolio Manager at GLOBALT Investments, highlighted that tech earnings are slowing and policy risks are rising. However, he remains positive on tech stocks as underlying fundamentals are strong. But he emphasized that diversification is key. He pointed out that while big tech hasn’t lost its luster yet, maybe it is time to look elsewhere.

Most investors focus on the big tech names like the Mag 7. As a result, there is a smaller probability of a mismatch between their valuation and their intrinsic value. The smaller tech names are usually overlooked. Hence, some of these stocks could offer deep value. Some US mid-cap stocks are deeply undervalued.

According to JP Morgan, US large-cap stocks have returned 12.6% annually over the past 10 years. Meanwhile, the same set of stocks have seen an EPS (earnings per share) growth of only 6.9% on an annualized basis, according to JP Morgan.

On the other hand, US mid-cap stocks have returned 9.3% annually over the past 10 years, with an EPS growth of 9.9% annually over the last 10 years. The large-cap stocks have seen superior returns despite lower earnings growth compared to mid-cap stocks in the same period. This underscores the value proposition of mid-cap tech stocks.

In the CNBC interview, Thomas Martin acknowledged that the Trump administration’s policies might have some effect on inflation and interest rates. However, according to Martin, those effects might be muted. That said, interest rates remain high, and smaller companies usually underperform during high interest rate regimes.

According to a quarterly report released by Pathstone in January 2025, smaller companies are facing several risks, including policy uncertainty and rising Treasury yields. As a result, while mid-cap tech stocks have potential, they need to be chosen carefully.

Mid-cap tech companies with strong balance sheets and decent profitability are better equipped to navigate through the high-interest rate period compared to those that are highly leveraged and have low profitability.

Our Methodology

We have curated a list of 10 mid-cap companies after considering the risks involved in investing in mid-cap companies. We used Finviz to include only companies with a market cap of $2 billion up to $10 billion, as we are looking for mid-cap stocks. As for the sector, we chose technology.

To weed out unwanted, low-quality mid-cap stocks, we chose only companies with decent profitability. So, we weeded out the companies with an operating margin of less than 10%. Since we want companies with a solid balance sheet, we set the long-term debt-to-equity ratio at under 0.5. We also chose companies with an average analyst upside of at least 10%. The stocks are sorted in ascending order of their upside potential. Additionally, we have mentioned the hedge fund sentiment for each stock, as of Q4 2024.

Note: All data was recorded on March 10, 2025.

At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A technician in a lab coat carefully working with OLED displays and components.

Universal Display Corporation (NASDAQ:OLED) 

Upside Potential: 18.11%

Market Capitalization: $7.06 Billion

Number of Hedge Fund Holders: 3o

Universal Display Corporation (NASDAQ:OLED) manufactures OLED (Organic Light Emitting Diode) technology, which is essential in displays for electronics like smartphones, televisions, and smartwatches, among others. The company makes money through royalties and licensing fees from these companies. Universal Display Corporation (NASDAQ:OLED)  also makes and sells materials required to make the OLED displays. The company also sells them to competing display manufacturers.

The company’s revenue has been growing steadily, and it is highly profitable with a net margin of a solid 34.2%. On January 2, 2025, Oppenheimer analyst Martin Yang reiterated the firm’s outperform rating on the stock. However, it reduced its price target to $200 from $220. That said,  Yang said that his conviction on the stock to outperform over the next 12 months is higher than before, despite the stock’s disappointing performance since the disappointing earnings result in Q3.

Oppenheimer believes the current price has priced in the near-term weakness in the markets for OLED displays. While Oppenheimer expects the management to report soft guidance for the current year, analysts expect the company’s revenue to grow by 14%.

Overall, OLED ranks 8th on our list of best mid cap tech stocks to buy now. While we acknowledge the growth potential of OLED, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than OLED but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires

Disclosure: None. This article is originally published at Insider Monkey.