Corning’s shares ended in the red in 16 out of 22 trading sessions in July, with the stock plummeting in double-digits on three of those days.
- Truist upgraded Corning to ‘Buy’ from ‘Hold’, with its new price target of $175 implying an upside potential of about 27% from Friday’s closing price.
- Truist said customer spending in Corning’s optical communications business remains firm despite broader market concerns.
- The analysts also pointed to Corning’s newly introduced Photonics MAP as an incremental growth catalyst that could support the business through the end of the decade.
Corning Inc. (GLW) shares tumbled nearly 46% in July, making it the worst month for the company’s investors in 24 years after the company’s third-quarter (Q3) guidance fell short of Wall Street expectations.
Corning’s shares ended in the red in 16 out of 22 trading sessions in July, with the stock plummeting in double digits on three of those days.
However, analysts at Truist see the selloff in Corning shares last month as a buying opportunity, according to TheFly.
Corning shares were up more than 1% in Monday’s pre-market trade.
Why Truist Analysts Are Bullish On GLW
Truist upgraded Corning to ‘Buy’ from ‘Hold’, even as it lowered its price target to $175 from $205, implying an upside potential of about 27% from Friday’s closing price. The firm argued that the stock’s recent selloff has created an attractive buying opportunity.
Truist said customer spending in Corning’s optical communications business remains firm despite broader market concerns, adding that the demand for the company’s networking products has held up well.
The analysts also pointed to Corning’s newly introduced Photonics MAP as an incremental growth catalyst that could support the business through the end of the decade. Combined with resilient customer spending, Truist expects Corning’s sales growth to accelerate over the next several years, underpinning its more bullish stance on the stock.
UBS Also Sees Opportunity
UBS analyst Joshua Spector also remained constructive on Corning despite lowering his price target to $196 from $228 and reiterating a ‘Buy’ rating.
The analyst said the recent selloff appears overdone, with only modest estimate revisions reflecting a more conservative outlook for the company’s fiber capacity expansion and the timing of its photonics business.
Morgan Stanley Is Not Convinced
Morgan Stanley struck a more cautious tone on Corning, lowering its price target to $165 from $180 while maintaining an ‘Equal Weight’ rating. The firm said the company’s second-quarter (Q2) results largely played out as expected, with sold-out conditions limiting the potential for further upside.
The analysts also noted that a significant portion of Corning’s products is sold under long-term agreements, leaving limited room for additional pricing gains or earnings-per-share upside.
GLW’s Q3 Miss Disappoints Wall Street
Corning’s Q3 guidance fell short of Wall Street expectations, with the specialty glass and materials maker forecasting earnings per share (EPS) between $0.85 and $0.89. At a midpoint of $0.87, Corning’s Q3 EPS forecast is slightly ahead of a consensus estimate of $0.85, according to Fiscal.ai data.
Corning also expects its Q3 revenue to come in between $4.9 billion and $5 billion. At a midpoint of $4.95 billion, it misses the consensus estimate of $5 billion.
Corning reported an EPS of $0.78 on revenue of $4.74 billion, beating Wall Street estimates of an EPS of $0.75 on revenue of $4.63 billion.
What Retail Investors Think Of GLW Stock
Retail sentiment on Stocktwits around Corning trended in the ‘bullish’ territory at the time of writing.
GLW stock is up 58% year-to-date and 119% over the past 12 months. The S&P 500 ETF (SPY) is up 18% over the past 12 months, while the Vanguard Mid-Cap Index Fund ETF (VO) is up 13%.
The Vanguard Total Stock Market Index Fund ETF (VTI) and the Vanguard S&P 500 ETF (VOO) are up 18% during this period.
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