Through TheFLY's Eyes: Corning Incorporated
from Theflyonthewall.com







Weak Flat Panel Sales, But Telecommunications Business Is Picking Up

Prior to attending two investor conferences this week, Corning (GLW) released a business update where it expects its liquid crystal display (LCD) business to be weaker than forecast. The stock sold off as the company expected the LCD to be flat to down 5%, versus a previous estimate of being flat to up 5%.

However, despite the negative news on the LCD front, the old telecommunications business continues to come back. Management upped its guidance for growth of 15% to 20%, from the previous guidance of 10% to 15% growth. Higher-than-expected demand from the US and Europe for fiber, hardware and equipment products are the reasons for the guidance increase.

As we have been saying in our blogs, the commodity that is going to see growth in the second half of 2006 is bandwidth, not copper and gold. Demand along the whole fiber food chain is getting tighter and tighter. Corning will benefit along with companies like JDS Uniphase (JDSU) and Applied Micro Circuits Corporation (AMCC).