Corning Earnings: AI Drives Good Results in Line With Positive Guidance

We are maintaining our $37 per share fair value estimate for shares of narrow-moat Corning after positive second-quarter results leave our long-term thesis unchanged. We raised our optical growth expectations when Corning pre-announced results early in July. The firm continues to work its way back from weak performance in 2023, and management reiterated confidence in Corning’s three-year “Springboard” growth plan. Optical sales continue to shine, with Corning benefiting from AI data center buildouts that use its fiber. We forecast robust growth for the firm over the next three years, with optical and AI as meaningful growth drivers. Shares dropped as much as 10% on guidance missing consensus, but we see the forecast as only modestly light and continue to like Corning’s long-term opportunity. We see shares as fairly valued.