Corning Earnings: Our Rebound Thesis Is Bearing Out, but Shares Now Look Inflated

We maintain our $37 fair value estimate for narrow-moat Corning as we believe our long-term thesis is bearing out. Corning’s financial results are recovering as demand returns in its primary end markets, and we have confidence in management’s Springboard plan for strong growth through 2026 and beyond. We believe revenue and margin will see a positive upward trajectory through 2026. The firm’s current growth is being led by data center and artificial intelligence investment, which generates good demand for Corning’s optical fiber. Even as we expect strong growth for fiber optics to continue, we believe the firm will retain diversified growth exposure. Its strength across disparate markets with centralized investment is a key tenet of our narrow moat rating and exemplary capital allocation rating. We see the stock as overvalued, especially considering its jump after results. We have rosy expectations for Corning’s growth but believe the shares have overshot fundamentals.