Today we're going to take a closer look at Large-Cap Industrials company Corning, whose shares are currently trading at $67.98. We've been asking ourselves whether the company is under or over valued at today's prices... let's perform a brief value analysis to find out!
Corning's Valuation Is in Line With Its Sector Averages:
Corning Incorporated operates in optical communications, display technologies, environmental technologies, specialty materials, and life sciences businesses. The company belongs to the Industrials sector, which has an average price to earnings (P/E) ratio of 24.03 and an average price to book (P/B) ratio of 2.89. In contrast, Corning has a trailing 12 month P/E ratio of 72.3 and a P/B ratio of 4.95.
Corning has moved 64.7% over the last year compared to 15.1% for the S&P 500 — a difference of 49.6%. Corning has a 52 week high of $69.29 and a 52 week low of $37.31.
The Company's Revenues Are Declining:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $11,503 | $11,303 | $14,082 | $14,189 | $12,588 | $13,118 |
| Gross Margins | 35% | 31% | 36% | 32% | 31% | 33% |
| Net Margins | 8% | 5% | 14% | 9% | 5% | 4% |
| Net Income (M) | $960 | $512 | $1,906 | $1,316 | $581 | $506 |
| Net Interest Expense (M) | $221 | $276 | $300 | $292 | $329 | $310 |
| Depreciation & Amort. (M) | $1,390 | $1,399 | $129 | $123 | $122 | $1,229 |
| Diluted Shares (M) | 899 | 772 | 844 | 857 | 859 | 869 |
| Earnings Per Share | $1.07 | $0.54 | $1.28 | $1.54 | $0.68 | $0.58 |
| EPS Growth | n/a | -49.53% | 137.04% | 20.31% | -55.84% | -14.71% |
| Avg. Price | $27.5 | $26.49 | $37.55 | $35.09 | $30.45 | $68.93 |
| P/E Ratio | 24.77 | 49.06 | 28.88 | 22.49 | 44.13 | 116.83 |
| Free Cash Flow (M) | $53 | $803 | $1,775 | $1,011 | $615 | $974 |
| CAPEX (M) | $1,978 | $1,377 | $1,637 | $1,604 | $1,390 | $965 |
| EV / EBITDA | 9.99 | 13.38 | 15.06 | 22.37 | 31.15 | 27.19 |
| Total Debt (M) | $7,740 | $7,972 | $7,044 | $6,911 | $7,526 | $7,211 |
| Net Debt / EBITDA | 1.97 | 2.78 | 2.18 | 3.36 | 5.68 | 2.3 |
| Current Ratio | 2.12 | 2.12 | 1.59 | 1.44 | 1.67 | 1.62 |
Corning has generally positive cash flows, a decent current ratio of 1.62, and healthy leverage levels. However, Corning has slight revenue growth and decreasing reinvestment in the business, slimmer gross margins than its peers, and declining EPS growth.
