Here’s What To Expect From Corning’s Q1

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Corning (NYSE: GLW) is scheduled to report its Q1 2023 results on Tuesday, April 25. We expect the company to post revenue and earnings in line with the street expectations. Although the company has benefited from 5G expansion and cloud computing in recent quarters, it expects the overall top line to be weighed down by the lockdowns in China.  Furthermore, we believe GLW stock has little room for growth, as discussed below. Our interactive dashboard analysis of Corning Earnings Preview has additional details.

(1) Revenues expected to be in line with the consensus estimates

  • Trefis estimates Corning’s Q1 2023 revenues to be around $3.35 billion, reflecting a high single-digit y-o-y decline and aligning with the consensus estimate.
  • Corning should continue to benefit from higher panel maker utilization and pricing actions, likely offset by lower volume and the impact of China lockdowns. Lower demand in the smartphone, notebook, and tablet markets may add to its woes.
  • Looking back at Q4 2022, Corning’s revenues declined 7% y-o-y to $3.4 billion, primarily due to a 17% fall in Display Technologies segment sales.
  • Our dashboard on Corning’s Revenues offers more details on the company’s segments.
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(2) EPS likely to align with the consensus estimates

  • Corning’s Q1 2023 earnings per share (EPS) is expected to be $0.39 per Trefis analysis, aligning with the consensus estimate but lower than the $0.54 figure seen in the prior year quarter.
  • Corning’s adjusted net income of $402 million in Q4 2022 reflected a 14% fall from its $465 million figure in the prior-year quarter. This can be attributed to lower revenues and a 220 bps operating margin contraction.
  • For the full-year 2023, we expect the adjusted EPS to be at $2.10, compared to $2.09 in 2022.

(3) GLW stock has little room for growth

  • We estimate Corning’s Valuation to be around $37 per share, 8% above the current market price of $34.
  • This represents a forward P/E multiple of 18x based on our EPS estimate of $2.10 for 2023, compared to the last three-year average of 19x.
  • However, if the company reports upbeat Q1 results and provides a 2023 outlook better than the street estimates, the P/E multiple will likely be revised upward, resulting in higher levels for GLW stock.

Note: P/E Multiples are based on Share Price at the end of the year and reported (or expected) Earnings for the full year

While GLW stock looks like it has little room for growth, it is helpful to see how Corning’s Peers fare on metrics that matter. You will find other valuable comparisons for companies across industries at Peer Comparisons.

Furthermore, the Covid-19 crisis has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised at how counter-intuitive the stock valuation is for 3M vs. AGCO.

Despite higher inflation and the Fed raising interest rates, GLW stock has risen 4% this year. But can it drop from here? See how low Corning stock can go by comparing its decline in previous market crashes. Here is a performance summary of all stocks in previous market crashes.

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

Returns Apr 2023
MTD [1]
2023
YTD [1]
2017-23
Total [2]
 GLW Return -5% 5% 38%
 S&P 500 Return 0% 7% 84%
 Trefis Multi-Strategy Portfolio 2% 10% 245%

[1] Month-to-date and year-to-date as of 4/21/2023
[2] Cumulative total returns since the end of 2016

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