Corning Inc. (NYSE: GLW) isn't a flashy, headline-grabbing tech stock, but it supplies key components to technologies we use every day. Its specialty glass goes into LCD screens large and small, its fiber optic cables play a key role in the modern telecommunications infrastructure, and its Gorilla Glass can be found in a wide array of smartphones. 

That Corning's products are critical in such a wide variety of uses is part of what makes it attractive as an investment, but the company faces significant competitive pressure that could limit its profitability. Let's examine key facts about Corning's business, and consider whether its stock is a buy for investors today. 

LCD TV on a stand.

Image source: Getty Images.

Where Corning makes its money

The most profitable division at Corning is display technologies, which makes glass for LCD screens. That may sound like a commodity business, but the technology required to make the thin glass that allows an LCD screen to be both light and durable is complex, which is why Corning can produce net margins in the segment that are extremely high for an industrial company -- 27.7%. 

Optical communications is more commonly known as fiber optic cable, which has long been the backbone of the internet, and is now making its way to consumers' homes. Fiber optic cables are what allow for lightning-fast internet connections (and the streaming video services that rely on them) -- a booming business with 18% top-line growth in 2017 for Corning. Here's a look at some metrics from Corning.

Division 2017 GAAP Revenue
% Change YOY
2017 GAAP Net Income
% Change YOY
Display technologies

$3.00 billion


$831 million


Optical communications

$3.55 billion


$341 million 


Environmental technologies

$1.11 billion


$127 million


Specialty materials

$1.40 billion


$249 million


Life sciences

$879 million


$64 million


GAAP = unadjusted. YOY = year-over-year. Data source: Corning. 

Environmental technologies (the division that produces a cellular ceramic substrate for catalytic converters) and life sciences (which contributes material-science expertise for research and drug companies) are also sizable business units at Corning, but aren't really part of the core glass and communications markets. 

The final division is specialty materials, which makes, among other things, Gorilla Glass -- an advanced display product that's gaining favor among smartphone manufacturers around the world. Gorilla Glass is far harder to break (vital for our oft-dropped smartphones) as well as clearer and more touch-sensitive than competing products. The business may be small today, but Grand View Research predicts scratch-resistant glass will be an $8.2 billion market by 2020. Apple's $200 million Advanced Manufacturing Fund award for Corning's glass plant in Harrodsburg, Kentucky, is another validation of the product's importance. 

The theme here is that Corning is essentially a tech company disguised as a materials science company. Most of the end-user demand for its products comes from companies who make TVs, smartphones, tablets, and computers. Corning provides enabling products for the technology industry, giving it a symbiotic relationship with tech that has served it well over the years. 

Investing in growth

Management sees fiber optics and advanced glass as growth markets, and it spent $1.8 billion on capital expenditures in 2017 to meet the rising demand. It also acquired 3M's fiber optics business for about $900 million. Zion Market Research projects the fiber optic market will grow 5.2% annually through 2022 to $3.7 billion. 

Smartphone sales will continue to grow as well. According to IDC, 1.53 billion smartphones were sold in 2017, and the market research firm expects 1.77 billion will be sold in 2021 -- and that's just one of the major end markets Corning sees growing right now. Given all that, the company looks like a surprising growth stock. 

Overall, management guided for 7% revenue growth in 2018 to around $11 billion and plans to invest $10 billion through 2019 on "growth and sustained leadership."

Is Corning a buy? 

I like Corning's market position, but a stock also needs an attractive valuation to make it a great buy for investors. In this case, shares trade at a price-to-earnings ratio of 16.1 as of this writing, which is a good value for an industrial stock with a lot of growth potential. 

Corning also has a healthy balance sheet with only $811 million of net debt. Given its low debt and reasonably low P/E ratio, combined with its positions as a power player in fiber optics, LCDs, and smartphone glass, this stock looks like a great buy for long-term investors.