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Tuesday, Corning (NYSE:GLW) shares received a reiterated Buy rating and a $54.00 price target from Deutsche Bank (ETR:DBKGn). The firm's analysts included Corning in their Catalyst Call Buy list, anticipating the stock to climb as the company approaches its Analyst Day on March 18th. The stock, currently trading at $49.84 and near its 52-week high of $51.03, has delivered an impressive 68.54% return over the past year.
According to InvestingPro analysis, the stock appears slightly overvalued at current levels. Despite expectations of a first-quarter guide indicating a reduction in sales and earnings per share due to seasonality and a higher Japanese Yen hedge rate, analysts see this as a potential "clearing event" before a more positive Analyst Day.
At the upcoming Analyst Day in New York, Corning is expected to provide further details and updates on its Project Springboard plan, which aims to add $3 billion in incremental revenue beyond its current $12.61 billion. The company is currently ahead of schedule with this initiative. Analysts also forecast that Corning will offer more clarity on its ability to enhance earnings per share and free cash flow per share growth, with an anticipated 15% compound annual growth rate in EPS over the next three years according to Deutsche Bank's estimates.
The anticipation of increased profitability and free cash flow is expected to lead to higher returns for shareholders. Deutsche Bank's model predicts an escalation in share buybacks and a resumption of dividend growth for Corning in 2025.
The current trading price of Corning's shares at 18.9 times the projected core EPS for 2026 represents a nearly 1x discount to the S&P 500, which the analysts note is attractive given the expected above-market EPS growth rate.
In other recent news, Corning Incorporated has been the focus of recent financial developments and strategic decisions. The company announced robust Q3 2024 results, with sales rising by 8% to $3.73 billion and earnings per share (EPS) increasing by 20% to $0.54. The growth was largely driven by a 55% surge in the Optical Communications segment's Enterprise sales. Looking ahead, Corning predicts a buoyant Q4, with sales expected to grow approximately 15% and EPS to increase by 40%.
Analysts from Citi and JPMorgan have shown confidence in the company's performance. Citi analysts have raised their price target on Corning shares to $58, maintaining a Buy rating, citing the firm's strong positioning for both secular and cyclical demand recovery within its various business segments. JPMorgan has reaffirmed its Overweight rating on Corning with a steady price target of $60, highlighting the company's strong market performance and stable demand.
Corning is also dealing with a European Commission antitrust probe concerning its supply of Alkali-aluminosilicate glass. In response to preliminary findings suggesting potential market dominance and anticompetitive practices, Corning has proposed to discard exclusivity clauses in its contracts with original equipment manufacturers (OEMs) and finishers. These commitments, which apply globally, are expected to be in effect for nine years.
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