This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Corning and New American Manufacturing

NEW YORK ( TheStreet) -- Even with its recent post-IPO collapse Facebook (FB) is selling at more than 80 times its trailing year earnings.

Corning (GLW) is trading at less than 8.

The reason is simple. Facebook sells digital goods, while Corning actually makes stuff. Americans can't make stuff, right?

Wrong.

We think of manufacturing as a bunch of low-skilled workers assembling things on a mass production line, the way Henry Ford and the Manhattan sweatshops did it a century ago. This is the way China does it. They have logistics, they treat people as disposable, they compete fiercely within this narrow space and they rule the world.

But there are other ways to make things, even in massive quantities. There's the Corning way.

Corning's latest product is called Willow Glass. It's tough, like the Corning Gorilla Glass you find on your phone or tablet now. But it's also very thin, it's flexible, and Corning has found a way to make it the way you make newsprint, roll-to-roll, as opposed to the way you make glass panes, sheet-on-sheet.

This is going to revolutionize the industry. Instead of next year's phones being like thin bricks, they could be more like folded rubber sheets. And the scalability of this process is simply enormous. So, yes, Corning has plants in Shanghai and in China. But it also has two plants in North Carolina.

The point is there is an immense amount of intellectual property in Willow Glass. There is an immense amount of capital behind it. But there isn't a lot of labor. Corning has been coming up with stuff like this for a century, moving smoothly from eyeglasses to dishes to architectural glass and now to monitor coverings.

Corning hasn't just made a better display glass. It has also innovated new, lower-cost production techniques that should keep this technology in American hands for years to come.

It's already showing up on the bottom line. Corning's sales volumes are up 25% since 2008, they're taking nearly half of that to the gross profit line, and nearly a third shows up on the net income line. The company could pay its current debt load out of cash twice over, with nearly $5.8 billion in cash and short-term investments on the books. It has over $17 billion in plant and equipment on the books.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,156.85 +24.88 0.15%
S&P 500 2,001.57 +2.59 0.13%
NASDAQ 4,562.1890 +9.43 0.21%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs