Corning stock may be skyrocketing on Tuesday, but Jim Cramer has a clear message for investors tempted to take profits: The rally isn’t over yet. Shares surged more than 16% after CNBC reported that Corning inked a new partnership with fellow Club holding Meta Platforms . The Facebook parent said it will pay Corning up to $6 billion for fiber-optic cables to use in its data centers through 2030. Corning hit a new high on the announcement and is the S & P 500 ‘s biggest gainer for the day. But the monster move isn’t a reason for investors to cash out, Cramer says. “Don’t sell this stock,” he said during Tuesday’s Morning Meeting . “Understand, we [are] in this thing not for $109, but for $200.” Corning stock reached an intraday high of nearly $114 and has jumped more than 123% in the past year. Demand for its fiber optics cables is surging. That’s because these offer a more energy-efficient option to the copper wiring currently found in data centers. As big tech companies look to build larger data centers over time, Corning can gain more market share in the booming data center market. And that’s exactly what we’re seeing with this new Meta deal. As part of the partnership, Corning is expanding its operations to meet demand not only from Meta, but also potential future orders from other big AI spenders like OpenAI, along with Club names Nvidia , Alphabet ‘s Google, Microsoft , and Amazon . In fact, CEO Wendell Weeks said the deal will make Corning the world’s largest fiber-optic cable plant. “Almost every phone call I get from my customers is trying to see, ‘How do we get them more?'” Weeks told CNBC. “I think next year the hyperscalers will be our biggest customers.” On top of that, Corning’s partnership with Apple as the supplier of glass for its iPhones is a huge tailwind. In August, Apple announced a $2.5 billlion investment into Corning’s Kentucky manufacturing facility, which CEO Weeks said would triple production. All of this is “a big validation of our thesis,” Jeff Marks, the Investing Club’s director of portfolio analysis, said during the Morning Meeting. “It’s exactly what we’ve been waiting for.” Corning is set to report earnings on Wednesday morning, after which we’ll consider updating our price target on the stock. The Club currently has a target of $95 per share and a buy-equivalent 1 rating. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Add Comment