Corning Incorporated GLW recently announced that it expects to add more than $4 billion in annualized sales with a 20% operating margin by 2026, up from a prior expectation of $3 billion. The company upgraded its sales CAGR for the Enterprise business of Optical Communications to 30% for the 2023-2027 period from the prior estimation of 25%. It also raised its guidance for the first quarter of 2025. Revenues are now expected to exceed the prior estimation of $3.6 billion and earnings per share are expected to be at the higher end between 48 and 52 cents.

Major Growth Drivers

Upward revision of its high confidence Springboard plan is backed by several growth drivers. Rising demand for Corning’s advanced generative AI-powered products in data centers is driving growth in the Optical Communications segment. Rapid AI adoption by enterprises across industries will significantly boost prospects in the upcoming years.

Corning’s competitive strength lies in its focus on innovation. Its advanced Gen AI fiber and cable systems that interconnect AI data centers allow for fitting two to four times fiber in the existing conduit. Such a compact, innovative design enables data centers to increase connectivity capacity without having to make significant changes in their existing infrastructure. Since fully commercializing these products, GLW has immensely increased its production to match the rapid increase in demand.

The pricing adjustment implemented in the second half of 2024 will ensure consistent profitability in the Display Technologies segment. The price increases will allow this segment to generate $900-$950 million in profit this year with a net margin of 25%
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Designed to unlock opportunities for valuable synergies, Corning’s operating structure has been reorganized to align executive management and business teams around five Market-Access Platforms (MAPs): Mobile Consumer Electronics, Optical Communications, Automotive, Life Sciences and Display.

The company boasts a leadership position in each of these markets. GLW recently introduced the Solar Market Access Platform, which will focus on developing the domestic solar supply chain in the United States. Corning is set to introduce made-in-America wafer products in 2025. This will likely boost net sales, cash flow and profit in the second half of 2025. Management anticipates GLW will generate $2.5 billion in revenues from this new MAP by 2028, up from $1 billion in 2024.

Will These Developments Drive GLW’s Share Performance?

Corning introduced the Springboard plan in 2024 with a focus on increasing net sales, and rapidly improving profitability and cash flow based on its leadership position across several end markets and strong foundation of innovation. Since the launch of the program, the company’s core sales have improved 18%, whereas adjusted free cash flow is up 42% and core EPS is up 46% in one year.

Moreover, core ROIC (return on invested capital) expanded by 390 basis points, highlighting efficient resource management. Backed by its deep industry expertise in optical communications, display technologies and solar energy markets, the company is aiming to further capitalize on its robust financial performance achieved from the Springboard plan so far. This strategy bodes well for long-term growth.

GLW’s Stock Price Movement

Shares of Corning have gained 44.7% over the past year compared with the industry’s 34.4% growth.

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GLW’s Zacks Rank & Stocks to Consider

Corning currently carries a Zacks Rank #3 (Hold).

Stocks to Consider

InterDigital IDCC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the trailing four quarters, it delivered an earnings surprise of 158.41%. It is a pioneer in advanced mobile technologies that enable wireless communications and capabilities. The company designs and develops a wide range of advanced technology solutions used in digital cellular, wireless 3G, 4G and IEEE 802-related products and networks.

United States Cellular Corporation USM flaunts a Zacks Rank of 1 at present. In the last reported quarter, it delivered an earnings surprise of 150%.

U.S. Cellular has taken concrete steps to accelerate subscriber additions and improve churn management. The company aims to offer the best wireless experience to customers by providing superior quality network and national coverage. It is well-positioned to support the investment required for network enhancements, including the deployment of 5G technology.

Celestica Inc. CLS sports a Zacks Rank #1 at present. The company provides competitive manufacturing technology and service solutions for printed circuit assembly and system assembly, as well as post-manufacturing support to many of the world's leading original equipment manufacturers.

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