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Corning (NYSE:GLW) shares fell practically 2% in extended-hours buying and selling on Monday after funding agency J.P. Morgan downgraded it on fears of a “tepid restoration” into earnings.
Analyst Samik Chatterjee lowered the agency’s score on Corning (GLW) shares to impartial from chubby, noting that the prospect for earnings upside over the close to to medium-term is “extra muted than anticipated” because the restoration appears to be taking an extended time frame than initially anticipated.
“The direct consequence of a milder restoration is appreciable draw back to present consensus estimates that embed sequential earnings progress in 4Q23E, in addition to draw back to consensus expectations of +25% y/y EPS progress in 2024E,” Chatterjee, who additionally minimize the value goal to $36 from $43, wrote in an investor observe.
Chatterjee added that the expectation for 2024 is 17% year-over-year earnings progress, aided by pricing enhancements, layoffs, improved productiveness and stock reductions, however any vital enchancment in income is probably going dependent upon the tip markets, together with show, optical and smartphones.
“Importantly, that is within the backdrop of traders who are actually more and more focusing their consideration on Corning’s ‘new’ long-term income progress price, following nearly 4 years of assorted macro headwinds, which seems to be now monitoring nearer to mid-single digits relative to the prior long-term progress outlook of +6%-8%,” Chatterjee added.
Analysts are largely bullish on Corning (GLW). It has a BUY score from Looking for Alpha authors, whereas Wall Road analysts price it a BUY. Conversely, Looking for Alpha’s quant system, which persistently beats the market, charges GLW a HOLD.