Corning Insider Sale Earns Downgrade - TheStreet

NEW YORK (

TheStreet

) -- With

Corning

(GLW) - Get Report

shares at a one-year high, CFO Jim Flaws decided to sell stock. The move helped Davenport analyst Drake Johnstone slap a neutral rating on the stock.

On Dec. 4, Flaws exercised his option to buy 115,000 shares at about $11 each and then sold them for $18.15, netting a sweet $822,250 in cash from the deal.

"This action appeared to be at the behest of the CFO and not a preplanned sale," Johnstone wrote in a note Tuesday.

The sale is the second in the past two months for Flaws. In November, Flaws sold 100,000 shares for a net of $1.57 million. Those looking for a pattern will note that after the last two transactions, his holdings totaled 385,923 shares of Corning stock. Flaws appears to be cashing in options while maintaining a stable stake in the company.

Flaws' timing may be good, given the stock's run and next year's expected uncertainty of LCD TV sales.

Davenport's Johnstone, who has seen the stock surge 88% this year and approach his $20 target, says the stock may not have much more room to rise. Corning is "close to fairly valued," wrote Johnstone in his note.

The timing of Davenport's downgrade comes as LCD TV demand could be peaking.

Price cuts during the holiday season have helped juice LCD sales, but Johnstone says "there is potential risk that consumer demand may weaken in the first quarter of 2010."

Corning makes large sheets of liquid crystal display glass used in the manufacturing of thin, flat panels for TVs.

Corning shares were down 2% to $17.97 Tuesday.

-- Reported by Scott Moritz in New York