>Corning: Dominant Player in Fast-Growing LCD Glass Space

April 22, 2010

>A New York presenter believes Corning (NYSE: GLW, $20.40) doesn’t get enough credit for its dominant postion in the LCD glass market. The company commands a 60% share in the space that’s projected to grow 14-22% this year. Consumers around the world are both switching from CRT TV’s to LCD models and adding new TV sets. The penetration rate in North America is 40% and substantially lower in developing regions, where most of the growth will come from in the coming years. The company has high expectations for its new Gorilla Glass technology. Management predicts incremental sales from this product may reach $1-4 billion in the next 3 years. The technology is very well-suited for touch screen devices and new borderless TV’s. It’s already used by 17 major brands. The stock is currently trading at 10x forward earnings. The presenter believes that as concerns about the supply/demand picture subside, the multiple should expand to 12-14x. Incremental earnings from Gorilla Glass will be $0.20-0.75/share in his estimation.

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