Should You Buy It?: Corning

Shares of Corning (GLW - commentary - Cramer's Take) are currently changing hands at their lowest level in three years, after the high-tech glassmaker warned of lower third-quarter results Sept. 3. The main culprit this quarter was lower shipments of LCD glass (where the company generates more than 90% of its profit), as management said that television makers were working down inventory.

The company now expects to earn just 43-45 cents a share, compared with the previous consensus estimate of 50 cents. Revenue is also now seen coming in about $100 million short of expectations, at $1.58 billion to $1.62 billion.

Despite the earnings warning, Corning was upgraded from market-weight to overweight Sept. 8 at Thomas Weisel. This marks the first upgrade of the stock since the disappointing guidance vs. two downgrades.

With that in mind, I'm here to answer readers' questions: Should you buy it? Does Corning offer value at current levels, or should investors pass on trying to pick up the pieces of this battered stock?

At Wednesday's closing price of $16.22, Corning shares are down 32% year-to-date. The stock is also valued at just 8.8 times expected full-year earnings of $1.82 a share, which is the lowest multiple that Corning has seen in nearly six years. And those numbers don't even figure in the $1.96 billion ($1.25 a share) of net cash that the company has on the balance sheet.

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David Peltier is a research associate at TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Peltier appreciates your feedback; click here to send him an email.

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