Corning shares have fallen about 51% from their June record, even as the company's core earnings grow quickly. The company reports third-quarter results on Oct. 27, and Motley Fool analyst Daniel Sparks argues the lower valuation makes the stock worth a look.
Corning stock trades at roughly $125, about 51% below its June 29 record close of $255.69, according to Sparks. The glass and fiber-optics maker fell 8% on Oct. 22 alone, and it posts its third-quarter results on Tuesday, Oct. 27.
A rally that got ahead of the business
Sparks says much of the decline reflects the stock giving back a rally that outran the business. In May, Corning announced a long-term partnership with Nvidia to grow its U.S. optical connectivity manufacturing capacity tenfold, and Amazon then signed a multiyear, multibillion-dollar supply deal.
Shares then sank about 46% in July, including a 12% drop on July 28, when Corning reported second-quarter core earnings per share up 30%. On Sept. 11, the company signed an agreement to issue up to $2 billion in new shares from time to time, and shares sank around 14% the next trading day. Shares are down around 19% so far in October.
Optical communications drives growth
The business itself keeps expanding. Optical communications sales climbed 32% year over year to $2.07 billion in Q2, and enterprise network sales in that segment jumped 65%.
The segment provided about $506 million of the $693 million year-over-year rise in core sales, or about three-quarters of Corning's growth. Meanwhile, core earnings per share growth has accelerated from 24% in Q3 2025 to 30% in both Q1 and Q2 of 2026, and management forecast around 28% growth in the third quarter.
Lower valuation, but risks remain
The sell-off has cut the stock's valuation sharply. Shares now sell at around 44 times adjusted earnings for the past four quarters, under half the June peak ratio, and about 29 times analysts' consensus 2027 earnings estimate.
Risks persist, Sparks notes. Much of Corning's growth relies on a few tech giants continuing to spend heavily on AI data centers, and any cutback there could hit the optical business hard. If Corning uses its share-issuance agreement, current holders could also see their stakes diluted.
Source: The Motley Fool
Trading involves risk.
Risk Disclaimer
