Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+ . The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
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Highlights from the ratings report include:
- GLW's debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 4.03, which clearly demonstrates the ability to cover short-term cash needs.
- The gross profit margin for CORNING INC is rather high; currently it is at 55.10%. Regardless of GLW's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, GLW's net profit margin of 25.56% significantly outperformed against the industry.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 5.0%. Since the same quarter one year prior, revenues slightly dropped by 1.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, CORNING INC's return on equity is below that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to $634.00 million or 30.55% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
Corning Incorporated produces specialty glasses, ceramics, and related materials worldwide. The company operates in five segments: Display Technologies, Telecommunications, Environmental Technologies, Specialty Materials, and Life Sciences. Corning has a market cap of $18.69 billion and is part of the technology sector and electronics industry. The company has a P/E ratio of 10, below the S&P 500 P/E ratio of 17.7. Shares are down 2.5% year to date as of the close of trading on Tuesday.
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--Written by a member of TheStreet Ratings Staff.
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