Electronics Equipment, Instruments, & Components
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The following headlines have been reprinted from The Penn Wealth Report and are protected under copyright. Members can access the full stories by selecting the respective issue link. Once logged in, you will have access to all subsequent articles.
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GLW
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Penn member Corning spikes on a fantastic earnings report. (29 Jan 2019) Not all Apple (AAPL) suppliers are on the skids. Granted, high-tech glassmaker Corning (GLW $26-$34-$37) does a lot more than make screens for iPhones, which probably helps explain the blowout quarter it just notched. After downbeat reports from the likes of Nvidia (NVDA), Corning's report was a breath of fresh air. Sales came in at $3.04 billion, up 15% Y/Y, and $292 million of that amount (9.6%) flowed down as net income. A lot better than the same quarter last year, in which Corning took a $1.412 billion net loss. What led to the great numbers? The company took advantage of telecom companies ramping up their 5G effort, which led to a 26% increase in Corning's optical communications division. The biggest drag on the report was its specialty materials unit, which makes Gorilla Glass for...yep...iPhone covers. Corning was up over 11% on the earnings release. It's not enough for us to look at the technicals of a company which seems to have a steadily rising chart. We must also delve into what makes that company tick: the unique value proposition, the goods, the services, who its major customers are, and the like. Consider some of the high-flying chipmakers who relied on Apple (or Huawei, for that matter) for the lion's share of their sales. Two years ago, their technicals may have looked fantastic. Now, many are sitting down 80-90% from their highs. Fundamentals matter! Know what you are investing in and why.
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ESP
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Under the Radar
Espy Manufacturing & Electronics Corp. (18 Oct 2018) Espey (ESP $21-$29-$33), a $70 million micro-cap in the Electronic Components industry, does the grunt work for the US military. The company develops, designs, and produces specialized military and industrial electronics, transformers, shipboard systems, metal fabrication, testing equipment, and a host of other mission-critical items. With just 150 employees, the company had revenue of $32 million last year and generates positive net income yearly. Read more about this company in The Penn Wealth Report, Vol 6 Issue 04. |
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FNSR
AAPL GLW |
Apple awards Finisar $390 million from its Advanced Manufacturing Fund
(13 Dec 2017) In spring of this year, Apple's (AAPL $115-$173-$176) Tim Cook announced the creation of a $1 billion fund to invest in and support advanced manufacturing in the United States. Penn Global Leaders Club member Corning (GLW $24-$33-$33) became the first recipient, receiving $200 million from the fund for its work on state-of-the-art glass processing. Apple has just made its second award from the fund, this time to optical components maker Finisar (FNSR $17-$25-$36) for its work on vertical-cavity surface-emitting laser, or VCSEL, technology. VCSELs are semiconductor-based lasers which emit tens of thousands of highly-efficient laser beams used in facial recognition software, smartphone cameras, and a number of other developing technologies. FNSR shares were trading up 30% on news of the Apple investment. For an infographic on the history of VCSEL technology, click here. |
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GLW
MRK PFE |
(20 Jul 2017) Penn member Corning announces a new push into pharmaceutical glass.
Penn Global Leaders Club member Corning (GLW $21-$32-$32), which is up 86% since being added to the portfolio, announced a new $500 million push into the pharmaceutical glass business. As part of "Made in America" week, Corning CEO Wendell Weeks announced the initiative for Valor™ Glass at the White House, saying that this was just the beginning of a $4 billion initiative to modernize the glass packaging used in the pharma industry. Weeks was at the White House with the CEOs of collaboration partners Merck (MRK) and Pfizer (PFE). These are products you would absolutely expect to be made overseas, so this is a nice win for American manufacturing. Corning initially plans to hire an additional 1,000 workers for the division. |
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CLS
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(19 Jun 2017) Stock of the Day. Celestica named one of Canada's "Best 50 Corporate Citizens." Celestica Inc. (CLS $9-$14-$15), a small-cap ($1.9 billion) electronics manufacturing services company located in Toronto, has been named one of Canada's best "corporate citizens," based on the firm's commitment to responsible business practices. That's all well and good, but what about profitability? The company, which provides a host of electronic manufacturing services to firms in a wide range of industries, had an operating revenue of $6 billion last year, with $136 million flowing down as net income. With a P/E of just 15 and some decent free cash flow, long-term sentiment for the company is strong.
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