The long and short of Corning

Quarter shows exactly how good Corning's future could be

By Jim J. Jubak Oct 28, 2009 1:55PM

Jim JubakIf you've owned Corning (GLW) shares for any length of time as I have, you're familiar with this balancing act: Great long-term prospects push up the stock, while short-term worries push it down. 


That's exactly what investors got in the market reaction to Corning's third-quarter earnings announced on Monday.


The company reported earnings of 42 cents a share, beating Wall Street projections by three cents a share. Revenues were down 4.9% from the third quarter of 2008, but at $1.48 billion still came in $60 million above analyst expectations.


Dig a little deeper, and the quarter showed exactly how good Corning's future could be. Sales from units that represent products that are just gaining market traction now soared from second- quarter levels.


Environmental technologies, the home of Corning's diesel filter products, showed a 27% increase in sales from the second quarter. Specialty materials, the home of Corning's gorilla glass for touch-screen displays, increased sales by the same 27% from the second quarter.


But, as always, analysts and investors had just enough to worry about in the results from the company's current bread-and-butter business of glass for LCD television and computer displays. 


Corning said it expects volume in its wholly owned display business to be flat or down slightly in the fourth quarter from third-quarter levels. Prices, the company said, would be consistent with those in the third quarter.


Investors with long memories could breathe a sigh of relief: They remember the fear, not so long ago, that prices would plunge in the fourth quarter. 


Investors with more of a “what have you done for me lately?” approach were disappointed that the company didn't raise guidance or otherwise signal optimism for the fourth quarter and 2010.


It also didn't help the stock's price that the earnings announcement came as investors started to worry about Thursday's third-quarter GDP report. For more on that, see my October 26th post.


As of October 28th, I'm keeping my current target price of $19 a share for June 2010. (It traded below $15 Wednesday.)


At the time of this writing, Jim Jubak owned shares of Corning in his personal portfolio.

1Comment
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

122
122 rated 1
288
288 rated 2
472
472 rated 3
638
638 rated 4
628
628 rated 5
704
704 rated 6
609
609 rated 7
489
489 rated 8
275
275 rated 9
129
129 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
AAPLAPPLE Inc10
ATVIACTIVISION BLIZZARD Inc10
CTSHCOGNIZANT TECHNOLOGY SOLUTIONS10
FOXATWENTY-FIRST CENTURY FOX Inc CLASS A10
ITUBITAU UNIBANCO BANCO MULTIPLO S.A.10
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.