2 Blockbuster Events in Stocks: One Giant Falls, Another Soars! Booming Gains Await!

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Stocks

Stock	Price	52 Week Range	Marketcap	EPS	Dividend Yield	Chart (24H)	Sector	Employees	Last Updated
General Motors Company GM	$56.77		54.05B	6.55	1.05%		Consumer Cyclical	162,000	7 hours ago
Corning Incorporated GLW	$64.60		55.34B	0.94	1.74%		Technology	56,300	7 hours ago

“Adapt or die.” It’s a mantra that holds as true in investing as it does in life. Today, we delve into two massive shifts in the market landscape: the bankruptcy of General Motors (GM) and Corning’s revolutionary development of Gorilla Glass. These stories showcase the importance of foresight and adaptability—qualities crucial for any savvy investor.

For decades, General Motors reigned supreme, an industrial titan emblematic of American manufacturing prowess. Founded in 1908, GM swiftly rose to become the world’s largest automaker by the mid-20th century, dominating market share with flagship brands like Chevrolet, Cadillac, and Buick. GM’s assembly lines were a testament to industrial might, rolling out millions of vehicles that defined the American Dream.

Yet, beneath this facade of invincibility lay a series of festering issues. Mismanagement, union pressures, and a profound resistance to change began to erode GM’s robustness. The company became infamous for its unwieldy bureaucracy and product lines that, while once innovative, had grown stale and inefficient. The reliance on profitable-yet-inefficient gas guzzlers left GM vulnerable as global oil prices soared and foreign competitors began offering more fuel-efficient alternatives.

Unsustainable labor costs, coupled with enormous pension obligations, contributed heavily to GM’s financial woes. The final nails in the coffin came as the 2008 financial crisis unfolded, causing the automotive market to plummet. By June 1, 2009, GM was left with no choice but to declare Chapter 11 bankruptcy, one of the largest in U.S. history. The restructuring that followed was nothing short of brutal: billions in debt were shed, countless employees were laid off, and numerous brands were severed from the company’s portfolio.

The bailout reshaped GM as a smaller company, with assets largely government-owned and the United Auto Workers Union’s pension arm gaining control of approximately 20% of the company. GM’s American workforce was reduced to less than a tenth of its postwar peak. The company shuttered 14 plants, cut around 21,000 jobs, and slashed its dealer network by about 2,300 dealerships. Furthermore, the Hummer, Saturn, Saab, and Pontiac brands were axed, relegating GM to a leaner operational structure.

Emerging from bankruptcy, GM adopted a leaner, more strategic approach. With government intervention and a controversial bailout plan, GM was able to mount an initial public offering (IPO) in 2010, aiming to reclaim its position as an industry leader. Today, GM is pivoting towards electric vehicles (EVs) and autonomous technologies—a potential game-changer in its quest for revival.

Let’s take a look at what analysts are saying about GM and their ratings for the stock:

• Consensus Ratings: General Motors has a moderate buy consensus rating from TipRanks and no specific consensus rating from Zacks.
• Price Targets: The average price target from various sources ranges from $53.10 to $56.60, representing potential gains of 12.91% to 20.38% based on the current price.

While GM was grappling with its existential crisis, another drama was quietly unfolding in the world of high technology. Enter Steve Jobs and Apple, at the cusp of unveiling a game-changing product—the iPhone. Seeking the perfect material for their device’s screen, Apple turned to an old player with an innovative twist: Corning Incorporated, known for its specialized glass products.

Corning, employing decades of research and innovation, managed to bring to life an almost forgotten invention: Chemcor. This strengthened glass, initially developed in the 1960s, found newfound relevance in the form of Gorilla Glass. It was lightweight, damage-resistant, and exactly what Apple needed to disrupt the mobile phone market.

The journey to Gorilla Glass wasn’t a straight line. An earlier invention by Corning’s Donald Stookey, Pyroceram, had set the foundation, but Chemcor initially failed to gain commercial traction. Stookey’s accidental 1952 discovery of Pyroceram—produced by overheating a sample of photosensitive glass, turning it into a robust, milky-white plate—led to the material that would eventually be known as Gorilla Glass.

The results were nothing short of revolutionary. With Steve Jobs demanding a quick turnaround for the iPhone, Corning pivoted rapidly. The company’s scientists were given mere weeks to develop a workable, commercial-ready version of Gorilla Glass, refining the original Chemcor composition to meet Apple’s high standards. Gorilla Glass has since featured in over 1.5 billion devices worldwide, becoming a staple not just for Apple but for numerous tech giants. This strategic alignment with Apple positioned Corning as an indispensable component of the modern tech ecosystem, with its stock reflecting this newfound centrality.

Let’s take a look at what analysts are saying about Corning and their ratings for the stock:

• Consensus Rating: The stock has a consensus rating of “Moderate Buy” based on 24 recent ratings from analysts. Of these, 7 recommended a “Hold” and 7 recommended a “Buy.”
• Price Target: The average price target over the next 12 months is approximately $44.27.
• Upside Potential: The analysts predict an upside potential of 6.99%.
• Recent Ratings Trends: Over the past 90 days, Corning’s stock has seen 4 analyst upgrades and 1 downgrade.

Both GM’s dramatic fall and Corning’s meteoric rise offer invaluable lessons for investors. GM’s story serves as a potent cautionary tale; even the mightiest can fall if they fail to adapt to market shifts and consumer demands. Conversely, Corning illustrates the immense potential lying in constant innovation and strategic partnerships.

For investors, these narratives emphasize the importance of scouting for companies that not only possess a strong legacy but are also committed to forward-thinking and innovation. The market rewards those who can anticipate change and pivot accordingly. So, whether you’re eyeing the resurgence of GM in the EV and autonomous vehicle space or the continuous improvement in the glass technology sector spearheaded by Corning, remain vigilant and adaptable. The next big opportunity is often just around the corner, waiting for those who dare to look.

Our journey through these tales illustrates that the stock market isn’t just about numbers; it’s about understanding the dynamics of change. Embrace these insights, and let them guide your future investment decisions.

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