UPDATE: Goldman Sachs Upgrades Corning to Buy on Bottoming LCD Cycle

Goldman Sachs raised its rating on Corning

from Neutral to Buy and increased its price target from $14 to $16. Goldman Sachs commented, "We expect 4Q to mark the company's return to positive EPS growth for the first time in two years as a result of stabilizing LCD fundamentals following several quarters of supply discipline. We estimate Corning will reduce its dependence on LCD glass to 74% of net income in 2013 from 96% in 2009, with its other segments helping to drive mid-to-high single-digit growth in the next two years. Given a 20% decline in capex in 2012 and 2013, Corning's FCF yield will likely increase to 6% from 4% in 2013. Thus, we view the stock's below-book valuation as very attractive." Corning closed at $12.73 on Tuesday.