Research · Initiation · 6 October 2026
Corning NYSE: GLW
Corning's AI fibre is sold out. At US$159, the shares already pay for it to stay that way.
The call No call
- Price at publication
- US$159.37close, 5 October 2026
- Target
- Noneno position at this price
- Conviction
- Medium
What would prove the thesis wrongOptical Communications sales reach US$11.5 billion or more in 2027 with a segment net margin of 24 per cent or more, or the shares close above US$200 or below US$110 by October 2027.
What would turn this into a callA price below about US$127, or fourth quarter results in January 2027 showing optical sales of US$2.4 billion or more in the quarter with a segment net margin of 23 per cent or more, and the share sale programme largely unused.
Read the full notePDF, 5 pages: thesis, valuation, scenarios, risks and sources Open the modelExcel, live formulas: change an assumption and the target moves
The call in brief
- Corning makes the glass fibre that carries data between AI chips. Its optical sales rose 32 per cent in the second quarter, the data centre part 65 per cent, and the segment's margin reached a record 21 per cent.
- The US$2 billion share sale set up in September answers a real question. Corning is sold out, so growth needs factories first: capital spending rises to about US$2 billion this year, and customer deposits pay for only part of it.
- Optical is now the stock. Swinging optical from my bear case to my bull case moves 2028 earnings four times as much as doing the same to the rest of Corning.
- At US$159.37 the shares trade at 49 times my 2026 earnings and 29 times my 2028. At 27 times, the price needs optical sales of about US$16 billion in 2028, 2.6 times 2025.
- My call is no call: the base case is worth about US$146, 8 per cent below the price, and the range runs from US$86 to US$220.