Corning (GLW) Marked As A Barbarian At The Gate

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Corning ( GLW) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Corning as such a stock due to the following factors:

  • GLW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $156.6 million.
  • GLW has traded 2.9 million shares today.
  • GLW traded in a range 227.6% of the normal price range with a price range of $0.69.
  • GLW traded above its daily resistance level (quality: 5 days, meaning that the stock is crossing a resistance level set by the last 5 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on GLW:

Corning Incorporated manufactures and sells specialty glasses, ceramics, and related materials worldwide. The company operates through five segments: Display Technologies, Optical Communications, Environmental Technologies, Specialty Materials, and Life Sciences. The stock currently has a dividend yield of 2.3%. GLW has a PE ratio of 16.0. Currently there are 4 analysts that rate Corning a buy, 1 analyst rates it a sell, and 8 rate it a hold.

The average volume for Corning has been 8.1 million shares per day over the past 30 days. Corning has a market cap of $27.2 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.64 and a short float of 1.7% with 3.34 days to cover. Shares are up 19.8% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Corning as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and increase in net income. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 1.8%. Since the same quarter one year prior, revenues rose by 22.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • GLW's debt-to-equity ratio is very low at 0.17 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 3.60, which clearly demonstrates the ability to cover short-term cash needs.
  • Powered by its strong earnings growth of 157.14% and other important driving factors, this stock has surged by 26.51% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GLW should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • CORNING INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, CORNING INC increased its bottom line by earning $1.34 versus $1.07 in the prior year. This year, the market expects an improvement in earnings ($1.47 versus $1.34).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Electronic Equipment, Instruments & Components industry. The net income increased by 148.5% when compared to the same quarter one year prior, rising from $408.00 million to $1,014.00 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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