Markets & Finance

Salomon Cuts Corning Rating


Salomon Smith Barney downgraded its rating on shares of Corning Inc. (GLW) to outperform from buy.

The supplier of telecommunications and other specialized glass products posted $0.34 vs. $0.18 Q4 EPS (pro forma) on a 52% sales rise. Analyst Timothy Anderson says optical component inventory drawdowns at Nortel (NT) and Lucent (LU), as well as continuing uncertainty about carrier spending, is likely to put a perceptual overhang on shares, limiting Corning's near-term upside.

Anderson says Corning's Q4 looks solid, with a rough $0.03 EPS that is above consensus, after adjustments. He notes Corning's lowered guidance for Q1 by $100 million-$200 million on the top line and its widened EPS range to $0.28-$0.31 from $0.29-$0.30. The firm cites concerns of lower than expected photonic and fiber order rates in the first half of 2001. Corning maintained its stock-price estimate, but cut its $95 target to $90.


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