The Corning stock forecast article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology – Senior Analyst at I Know First.

Summary

• Thanks to the reliable prediction AI of I Know First, my June 25 buy recommendation for Corning Glass last June 25 is now a big winner.
• Corning stock price has risen from $25.81 to $31.12. I was correct in my prediction that GLW deserved a price target of $30. 
• The ongoing pandemic is boosting cloud computing. This should be enough reason to raise my price target for GLW to $35.
• Companies who are now learning to leverage cloud computing to remain 100% productive during this pandemic will continue to help improve GLW’s data center-centric business. 
• Bet more on Corning Glass because its partnership with Qualcomm for in-building 5G mmWave small-cell infrastructure is another strong growth driver.

The 20.5% increase in Corning Glass’s (GLW) stock price since my June 25 buy recommendation is a good excuse to take your profits. I did not expect that corning stock would quickly deliver my old 1-year price target of $30. Many investors apparently understood that Corning Glass is a major beneficiary of the rising cloud computing need. Corning Glass has a robust data centric-business. 

The chart above says GLW is now fairly valued because its Value Grade from Seeking Alpha Quantitative Rating is already a C+. However, Seeking Alpha’s Quant AI remains bullish on GLW because of its obvious growth potential. No thanks to COVID-19, the Quant AI of Seeking Alpha (which it got from buying CressCap last year) is confident that, going forward, Corning Glass is going to improve on its poor past 5-year revenue CAGR of 2.30%.

GLW’s Momentum Has Kept Investors Bullish

More importantly, in spite of GLW’s big 90-day price return of +40.61%, the predictive AI of I Know First still has a bullish one-year forecast for it. My hands-on experience is that if the Quantitative AI of Seeking Alpha and the predictive AI of I Know First are both bullish on stock, the profitable to thing to do is to quickly go long on the said stock. 

The best excuse I can give why I Know First remains bullish on Corning stock is that the stock is clear momentum-play buy right now. Refer to the chart below, the predictive AI of I Know First knew that GLW has outperformed its sector peers and the S&P 500 this year. After the pandemic panic last March, the stock market became infatuated with GLW. This stock’s recent impressive run-up is in spite of Corning Glass’s Q2’s -13.33% Y/Y revenue decline. Investors are now betting big on Corning Glass improved future prosperity.

The +23.09% 1 month return of GLW has made it fairly-valued. However, those of you who are not yet in a hurry to cash out your winnings on Corning Glass can still bet on the surging momentum of GLW. Further, compared to other data center-centric companies, GLW is not yet that expensive. Please refer to the chart below. The Price/Sales ratios of Corning Glass is still way lower than those of Amazon (AMZN) and Nvidia’s (NVDA). I don’t expect GLW hitting a TTM P/S valuation of 5 anytime soon. However, I think for a key player in the display technology and optical fiber industries, Corning Glass’s stock deserves a P/S ratio of at least 3x.

Corning Glass Healthy Revenue

My takeaway is that GLW could achieve the super valuation ratios of NVDA if Corning Glass management starts reporting a separate Data Center segment revenue figures. As of now, the data center-related sales of Corning Glass are mostly tucked inside its Optical Communications business segment. Sales to telecom and enterprise customers has helped the Optical Communications become Corning’s biggest revenue generator.

Yes, the Optical Communications is not yet as profitable as Display Technologies. However, as more small and medium companies build their own in-house data centers or rent from providers like Amazon (AWS), there will be increasing demand for Data Center Interconnect products.

Corning Glass Plays An Important Role In Cloud Computing

The rising investor love for GLW is easy to explain. The Data Center Interconnect or DCI market is expected to grow from at 12.1% CAGR until 2025. Meaning this year will see DCI revenue to be around $7.9 billion and it will grow to $14 billion by 2025. Corning Glass already discussed two years ago that its DCI business is expected to be a strong growth driver for the company. 

GLW can hit my 1-year price target of $35 because of its patented DCI products like RocketRibbon Extreme Density Cables. RocketRibbon is just one of several products that made Corning a leader in the Data Center Interconnect industry.

The growing need for more data centers during this pandemic means there is greater demand for Corning’s Data Center Interconnect products. The Edge8 data center base-8 solution is also an important product for data centers who need optical transmission speeds of up to 400G. 

More investors will eventually realize the important role that Corning Glass plays in the fast-growing $266 billion global cloud computing industry. GLW deserves a higher P/S valuation than its current TTM multiple of 2.26. The global cloud computing business touts a sales CAGR of 14.9%. This is enough tailwind that could boost GLW’s stock price 15 higher within the next 12 months. 

My one-year price target of $35 is reasonable. Multiple the current GLW price of $31.12 by 1.15 and you get $35.788. 

Conclusion

The other tailwind that could keep GLW flying higher is the partnership with Qualcomm (QCOM). Corning Glass is helping Qualcomm deploy cost-efficient indoor or in-building 5G mmWave small-cell network for private enterprises. The pandemic will eventually get solved. Most smartphones and computers next year will be 5G-compatible. Corning Glass therefore has a solid growth driver from in-building 5G mmWave infrastructure deployments. 

GLW is a strong buy because of its expertise in small-cell 5G networks. Even with the COVID-19 headwind, experts still expect the overall 5G infrastructure business to be worth $58.174 billion by 2025 – delivering a CAGR of 95.8%. I hope this article will convince more investors to boost GLW’s price to $35. Corning Glass has a bright future thanks to its expertise in small-cell 5G and data center interconnect products. 

Lastly, the weekly and monthly technical indicators and moving averages are still saying GLW remains a buy.

Past I Know First Success With Corning Stock

I Know First was successful with Corning stock forecast in the past. On June 25, 2020, the I Know First algorithm issued a bullish GLW stock forecast, which correctly predicted the movement of the stock. The forecast predicted that GLW stock would rise above $30 and it has. In the one month since this forecast, GLW stock price has increased 13.48%. See chart below.

Here at I Know First, our algorithmic trading AI have modeled and predicted more than 10,500 asset price movement worldwide. We provide daily stock market forecast to institutional clients, as well as private investors to identify the best investment opportunities in the market enabling them to pursue the most sophisticated investment strategies, like sector rotation. Additionally, we have various packages with stock market predictions, such as aggressive stocks, top tech stocks, and currency prediction. We also offer Apple stock forecast. Today, we also provide gold price forecast and commodity price prediction.

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