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Corning: The Recovery Has Started, Bernstein Says

Post Time:Apr 02,2009Classify:Company NewsView:278

Corning (GLW) shares are getting a lift from a bullish note by Bernstein Research analyst Jeff Evenson.

The analyst reiterated his Overweight rating on the LCD glass maker, and upped his price target on the stock to $15, from $13. For 2009, his EPS estimate jumps to 94 cents, from 65 cents, which puts him well ahead of the Street consensus at 68 cents.

“We believe the supply chain has started to build toward appropriate inventories, and expect continued positive news flow out of Korea and Taiwan in the next few months as most panels fabs are turned back on,” he writes. Evenson says the increased EPS estimate reflects his view that “supply chain inventory ratios have bottomed.”

However, Evenson stresses that the LCD supply chain has too much capacity, which will lead to stronger seasonality than in the past. “We think disappointments later this year will inevitably follow as investors realize that the Q2 and Q3 recovery is short-term in nature,” he writes.

Still, the market is cheered by his view that glass shipments should up in the low single digits in percentage terms in Q1 from Q4, with growth of about 30% at Samsung Corning in Q2, and 45% growth in its wholly owned glass operations.

GLW on April 1 was up 79 cents, or 6%, to $14.06.

Source: barrons.comAuthor: shangyi

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