The holiday season is off to a bustling start as consumers flood stores in search of the season's best deals. But it's the strong demand for LCD televisions that's most surprising -- particularly for those investors with a stake in Corning (GLW -0.06%). Today, the company's display technologies business makes up 37% of Corning's profits. While this is down from 40% in 2011, it still accounts for a significant portion of the company's total revenue. But what does this mean for investors?

Shares of Corning look especially cheap these days. The stock currently trades around $12 per share, with a price-to-earnings ratio below 10. The glass specialist also boasts an impressive balance sheet. In the most recent quarter, Corning had more than $6 billion in cash on the books. Yet, despite all of these winning attributes, the stock is down more than 3% year-to-date .

What gives?
The stock's 7.4% gain last month, which followed news that Corning would raise its fourth-quarter outlook on sales of LCDs and specialty glass for mobile devices, highlights the importance of its display technologies unit. Corning established its position as the market share leader in LCD glass through its longtime partnership with Samsung. However, declining sales of large-screen TVs for leading brands like Sony (SONY 0.31%) have held back shares for much of 2012.

OLED display supplier Universal Display (OLED 1.10%) has faced similar scrutiny over weakness in the flat-screen TV market. The stock plummeted last month after reporting disappointing results for its third quarter. Universal Display's earnings miss was largely due to slowing demand from customers such as Samsung and LG Display (LPL 1.78%) for its OLED TVs. That's because many consumers aren't able to justify the higher price of OLED products over their LED counterparts.

The industry leader
Many fear that both of these glass specialists will face ongoing pricing pressures in the year ahead. But when it comes to Corning, investors should instead be focused on the bigger picture. Through a steady stream of investments in research and development, Corning is committed to developing the next wave of technologies utilizing its specialty glass.

The company's vision for the future is nothing short of spectacular -- you can check out some of the concepts in this video by Corning: "A Day Made of Glass." Alternative uses for Corning's glass could cover a variety of industries and applications including vehicle interiors, home appliances, and architectural surface displays. And if anyone's going to carry us to the next level of interactive glass technology, it is Corning. Let's not forget the company's rich history of innovation: 161 years and counting.

Nearer-term challenges
More immediately, Corning faces the challenge of diversifying its revenue channels. Today, the company's fastest-growing business is its specialty materials division, which includes Gorilla Glass used in handheld touchscreen devices. Moreover, Corning's proprietary Gorilla Glass should continue to benefit from a fast-growing mobile industry. In fact, Gorilla Glass, which got its start in Apple's (AAPL 0.64%) original iPhone, is now the cover glass on more than 750 million mobile devices worldwide. This supplier relationship means we can expect to see Gorilla Glass in upcoming Apple products as well.

With Apple's rumored iTV on the horizon, I wouldn't be surprised if the final product featured Corning's Gorilla Glass. Some sources speculate that an iTV could come as soon as early 2013. While I doubt we'll see an Apple television set this soon, I do agree with Motley Fool tech analyst Eric Bleeker that an Apple-esque TV is the innovative spark that Corning needs to get TV volumes up and running again.

A future made of Glass
Near-term challenges have driven the stock price down recently. However, Corning isn't a stock that should be valued over the short term. In fact, at just nine times earnings, the stock is trading as if future profitability is out of the question. I think this creates a buying opportunity for patient investors.

The company's cash flow should recover in the year ahead as capital expenditures continue to decline. Furthermore, Corning has survived more than 161 years by continually evolving and adapting its technology for the future. In the next three years, I suspect we'll see Corning's Gorilla Glass being used in other products outside of the mobile industry. This should translate into meaningful growth in Corning's specialty materials unit.