Merrill Lynch cut estimates on Corning (GLW).
Analyst Steven Fox says the company attributed the shortfall to the global economic slowdown impacting business trends in all of its major served markets, especially the high margin, high fixed cost fiber business. He notes earlier this week he reduced estimates for Corning for the very same reasons. He now cut his $0.75 2001 EPS to $0.50, and trimmed the $0.40 2002 EPS estimate to breakeven.
He says Corning has decided to idle most of its fiber manufacturing facilitites; and plans to take a $1 billion charge. He says the timing and strength of the upturn remains uncertain. He maintains his near-term neutral and long-term buy rating. Fox thinks Corning's balance sheet, experienced management team and focus on R&D will bring the company out of its downturn successfully.