"GLW got me thinking of subscribing to Barron's because I saw reference to a negative article there"
The benefits of having a subscription in this case. I can go and look. Looking now, was it really a bad article that the person referenced?
Corning (GLW: NYSE)
By Sterne, Agee & Leach ($14.36, Sept. 9, 2011):
We have these statements:
"We are lowering our calendar third-quarter revenue and EPS estimates from prior $2.03 billion and 49 cents, respectively, to $1.98 billion and 43 cents, respectively, and lowering calendar 2011 revenue and EPS estimates from $8.1 billion and $1.98, respectively, to $8 billion and $1.84.
Our calendar 2012 revenue and EPS estimates go from $9.03 billion and $2.26, respectively, to $8.7 billion and $2.01, respectively"
Otoh with the stock at $13.42 now and $14.36 when the article came out, this can't be too bad when Sterne, Agee & Leach also say:
"Based on the revised guide, we have adjusted our estimates and lowered the price target to $24 [from $26].
[We rate Corning at Buy.]" (edit: Bold theirs)
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Also there's this blurb the previous month about Corning:
"A new QE? Markets Might Yawn, by J. Doherty
PERHAPS THE MOST POSITIVE THING to be said about today's stock market is that it already reflects an awful lot of bad news, and companies have balance sheets that are vastly improved since the 2008 downturn. One example: Corning.
Shares of the glass manufacturer have fallen 38% to $14.32 from roughly $23 in February. "I've followed this company for my entire career," says Edward Shill, chief investment officer at QCI Asset Management. There are times to buy and times to sell, and of late, Shill has been buying. He sees maybe $2 to $3 of downside risk and $10 of opportunity.
Shares reacted to the company's lowered estimates for this year's sales of LCD (liquid crystal display) glass, which goes into flat-screen televisions. Its customers have been reducing inventories in expectation of a slowdown in TV sales. "Panel makers have historically reacted to TV sales," says Shill. "Now they're trying to predict TV sales."
Corning's other businesses have become a larger part of the mix, and they're growing rapidly. The LCD business contributes just under 40% of revenues, with the rest of the company's sales coming from items like fiber used by the telecom industry, exhaust-pollution filters for trucks and cars, and Gorilla Glass -- a super-strong glass used in cellphones, tablets and laptops.
Corning's balance sheet is in fantastic shape, with $6.4 billion of cash and short-term investments, more than offsetting $2.3 billion of debt. In the last downturn, when shares traded down to $8, the company's balance sheet was is such dire straits that the company's solvency was a concern.
Now Corning's shares trade just north of book value and at only 6.6 times the $2.16 it's expected to earn in 2012. The icing on the cake: In early August, Chief Financial Officer James Flaws purchased 75,000 shares at roughly $13.50, spending a cool $1 million of his own money.
The purchase "demonstrates my belief in the company," says Flaws. While he declines to say what he thinks the shares are worth, Flaws would say that "at $13.50, it went below fair value."
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I have some GLW. I'll give some consideration now to averaging down on my small position.
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