Corning Rises 43.6% Year to Date: Reason to Buy the Stock?

Corning Incorporated GLW has gained 43.6% compared to the communications components industry’s growth of 31.3%. The stock has also outperformed the Zacks Computer & Technology sector and the S&P 500’s growth during this period.Image Source: Zacks Investment ResearchIt has underperformed compared to its competitors, such as CommScope Holding Company, Inc. COMM and Amphenol Corporation APH. CommScope has surged 205.4%, while Amphenol has gained 55% in the past year.GLW Rides on Portfolio Strength, Healthy DemandCorning’s competitive strength lies in its strong focus on innovation. Operating primarily in five market segments — Mobile Consumer Electronics, Optical Communications, Automotive, Life Sciences and Display — the company boasts a leadership position in each of these market segments. The restructuring of its operating structure to better align executive management and business teams around these market segments is paying off well. It has increased efficiency and created an opportunity to reuse assets and capabilities developed for customers in one market ecosystem to serve customers in another. The newly introduced Solar Market Access Platform, focused on developing the domestic solar supply chain in the United States, has gained solid market traction in the last two quarters. Management anticipates GLW will generate $2.5 billion in revenues from this new MAP by 2028.It is benefiting from solid demand in multiple segments. In the second quarter, the Optical Communication segment generated $1.56 billion in revenues, up 41% year over year, beating our estimate $1.47 billion. It is steadily developing innovative optical connectivity products for generative AI applications. This helps better equip the company to compete against other industry leaders such as CommScope and Amphenol.Specialty Materials generated $545 million in revenues, up 9% year over year, backed by healthy traction in the premium smartphone segment. Samsung has opted to deploy Corning Gorilla Armor 2 cover material for its latest Galaxy S25 Edge device. Growing demand for Corning’s most advanced Gorilla Glass among major smartphone manufacturers augurs well for long-term growth.GLW Benefits From Strategic CollaborationApple has committed $2.5 billion investment to develop all of iPhone and Apple Watch’s cover glass in Corning’s Kentucky manufacturing facilities. The initiative aligned with Apple’s $600 billion multiyear investment commitment in the United States. In this program, Corning has emerged as a major player. GLW is developing the most advanced glass production line in its Kentucky facility to match Apple’s requirements. This will likely drive net sales growth in Corning’s Specialty Materials segment in the upcoming quarters.Corning has also entered into a multi-year collaboration with Broadcom Incorporated, a premier designer, developer, and global supplier of a broad range of semiconductor devices. Through this partnership with Corning, Broadcom is aiming to deliver a next-generation co-packaged optics infrastructure designed to enhance the processing capabilities of data centers, marking a significant step toward addressing the growing demands of artificial intelligence workloads.Estimate Revision TrendEarnings estimates for Corning for 2025 and 2026 have increased over the past 60 days.Image Source: Zacks Investment ResearchKey Valuation Metric of GLWFrom a valuation standpoint, GLW is currently trading at a discount compared to the industry. Going by the price/earnings ratio, the company’s shares currently trade at 24.6 forward 12-month earnings, lower than 28.1 for the industry.Image Source: Zacks Investment ResearchEnd NoteCorning is benefiting from solid demand in the Optical Communications and Specialty Materials segment. Its U.S.-made solar products are also gaining solid market traction. Growing collaboration with major technology giants such as Apple, Broadcom and Samsung is a major tailwind. The positive estimate revision portrays bullish sentiments about the stock’s growth potential. Hence, with an attractive valuation and Zacks Rank 1 (Strong Buy), Corning appears to be a good investment option right now. You can see the complete list of today’s Zacks #1 Rank stocks here.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They includeStock #1: A Disruptive Force with Notable Growth and ResilienceStock #2: Bullish Signs Signaling to Buy the DipStock #3: One of the Most Compelling Investments in the MarketStock #4: Leader In a Red-Hot Industry Poised for GrowthStock #5: Modern Omni-Channel Platform Coiled to SpringMost of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amphenol Corporation (APH): Free Stock Analysis Report Corning Incorporated (GLW): Free Stock Analysis Report CommScope Holding Company, Inc. (COMM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks