Stock Analysis on Net

Corning Inc. (NYSE:GLW)

This company has been moved to the archive! The financial data has not been updated since May 2, 2024.

Capital Asset Pricing Model (CAPM) 

Microsoft Excel

Capital asset pricing model (CAPM) indicates what should be the expected or required rate of return on risky assets like Corning Inc. common stock.


Rates of Return

Corning Inc., monthly rates of return

Microsoft Excel
Corning Inc. (GLW) Standard & Poor’s 500 (S&P 500)
t Date PriceGLW,t1 DividendGLW,t1 RGLW,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2019 $33.26 2,704.10
1. Feb 28, 2019 $34.81 $0.20 5.26% 2,784.49 2.97%
2. Mar 31, 2019 $33.10 -4.91% 2,834.40 1.79%
3. Apr 30, 2019 $31.85 -3.78% 2,945.83 3.93%
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2023 $28.49 $0.28 7.51% 4,567.80 8.92%
59. Dec 31, 2023 $30.45 6.88% 4,769.83 4.42%
Average (R): 0.45% 1.11%
Standard deviation: 8.46% 5.31%
Corning Inc. (GLW) Standard & Poor’s 500 (S&P 500)
t Date PriceGLW,t1 DividendGLW,t1 RGLW,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2019 $33.26 2,704.10
1. Feb 28, 2019 $34.81 $0.20 5.26% 2,784.49 2.97%
2. Mar 31, 2019 $33.10 -4.91% 2,834.40 1.79%
3. Apr 30, 2019 $31.85 -3.78% 2,945.83 3.93%
4. May 31, 2019 $28.84 $0.20 -8.82% 2,752.06 -6.58%
5. Jun 30, 2019 $33.23 15.22% 2,941.76 6.89%
6. Jul 31, 2019 $30.75 -7.46% 2,980.38 1.31%
7. Aug 31, 2019 $27.85 $0.20 -8.78% 2,926.46 -1.81%
8. Sep 30, 2019 $28.52 2.41% 2,976.74 1.72%
9. Oct 31, 2019 $29.63 3.89% 3,037.56 2.04%
10. Nov 30, 2019 $29.04 $0.20 -1.32% 3,140.98 3.40%
11. Dec 31, 2019 $29.11 0.24% 3,230.78 2.86%
12. Jan 31, 2020 $26.69 -8.31% 3,225.52 -0.16%
13. Feb 29, 2020 $23.86 $0.22 -9.78% 2,954.22 -8.41%
14. Mar 31, 2020 $20.54 -13.91% 2,584.59 -12.51%
15. Apr 30, 2020 $22.01 7.16% 2,912.43 12.68%
16. May 31, 2020 $22.79 $0.22 4.54% 3,044.31 4.53%
17. Jun 30, 2020 $25.90 13.65% 3,100.29 1.84%
18. Jul 31, 2020 $31.00 19.69% 3,271.12 5.51%
19. Aug 31, 2020 $32.46 $0.22 5.42% 3,500.31 7.01%
20. Sep 30, 2020 $32.41 -0.15% 3,363.00 -3.92%
21. Oct 31, 2020 $31.97 -1.36% 3,269.96 -2.77%
22. Nov 30, 2020 $37.42 $0.22 17.74% 3,621.63 10.75%
23. Dec 31, 2020 $36.00 -3.79% 3,756.07 3.71%
24. Jan 31, 2021 $35.87 -0.36% 3,714.24 -1.11%
25. Feb 28, 2021 $38.24 $0.24 7.28% 3,811.15 2.61%
26. Mar 31, 2021 $43.51 13.78% 3,972.89 4.24%
27. Apr 30, 2021 $44.21 1.61% 4,181.17 5.24%
28. May 31, 2021 $43.63 $0.24 -0.77% 4,204.11 0.55%
29. Jun 30, 2021 $40.90 -6.26% 4,297.50 2.22%
30. Jul 31, 2021 $41.86 2.35% 4,395.26 2.27%
31. Aug 31, 2021 $39.99 $0.24 -3.89% 4,522.68 2.90%
32. Sep 30, 2021 $36.49 -8.75% 4,307.54 -4.76%
33. Oct 31, 2021 $35.57 -2.52% 4,605.38 6.91%
34. Nov 30, 2021 $37.09 $0.24 4.95% 4,567.00 -0.83%
35. Dec 31, 2021 $37.23 0.38% 4,766.18 4.36%
36. Jan 31, 2022 $42.04 12.92% 4,515.55 -5.26%
37. Feb 28, 2022 $40.40 $0.27 -3.26% 4,373.94 -3.14%
38. Mar 31, 2022 $36.91 -8.64% 4,530.41 3.58%
39. Apr 30, 2022 $35.19 -4.66% 4,131.93 -8.80%
40. May 31, 2022 $35.82 $0.27 2.56% 4,132.15 0.01%
41. Jun 30, 2022 $31.51 -12.03% 3,785.38 -8.39%
42. Jul 31, 2022 $36.76 16.66% 4,130.29 9.11%
43. Aug 31, 2022 $34.32 $0.27 -5.90% 3,955.00 -4.24%
44. Sep 30, 2022 $29.02 -15.44% 3,585.62 -9.34%
45. Oct 31, 2022 $32.17 10.85% 3,871.98 7.99%
46. Nov 30, 2022 $34.13 $0.27 6.93% 4,080.11 5.38%
47. Dec 31, 2022 $31.94 -6.42% 3,839.50 -5.90%
48. Jan 31, 2023 $34.61 8.36% 4,076.60 6.18%
49. Feb 28, 2023 $33.95 $0.28 -1.10% 3,970.15 -2.61%
50. Mar 31, 2023 $35.28 3.92% 4,109.31 3.51%
51. Apr 30, 2023 $33.22 -5.84% 4,169.48 1.46%
52. May 31, 2023 $30.81 $0.28 -6.41% 4,179.83 0.25%
53. Jun 30, 2023 $35.04 13.73% 4,376.86 4.71%
54. Jul 31, 2023 $33.94 -3.14% 4,588.96 4.85%
55. Aug 31, 2023 $32.82 $0.28 -2.47% 4,507.66 -1.77%
56. Sep 30, 2023 $30.47 -7.16% 4,288.05 -4.87%
57. Oct 31, 2023 $26.76 -12.18% 4,193.80 -2.20%
58. Nov 30, 2023 $28.49 $0.28 7.51% 4,567.80 8.92%
59. Dec 31, 2023 $30.45 6.88% 4,769.83 4.42%
Average (R): 0.45% 1.11%
Standard deviation: 8.46% 5.31%

Show all

1 Data in US$ per share of common stock, adjusted for splits and stock dividends.

2 Rate of return on common stock of GLW during period t

3 Rate of return on S&P 500 (the market portfolio proxy) during period t


Variance and Covariance

Corning Inc., calculation of variance and covariance of returns

Microsoft Excel
t Date RGLW,t RS&P 500,t (RGLW,tRGLW)2 (RS&P 500,tRS&P 500)2 (RGLW,tRGLW)×(RS&P 500,tRS&P 500)
1. Feb 28, 2019 5.26% 2.97% 23.19 3.49 8.99
2. Mar 31, 2019 -4.91% 1.79% 28.71 0.47 -3.68
3. Apr 30, 2019 -3.78% 3.93% 17.82 7.98 -11.93
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2023 7.51% 8.92% 49.92 61.03 55.20
59. Dec 31, 2023 6.88% 4.42% 41.40 11.00 21.34
Total (Σ): 4,149.94 1,634.30 1,756.92
t Date RGLW,t RS&P 500,t (RGLW,tRGLW)2 (RS&P 500,tRS&P 500)2 (RGLW,tRGLW)×(RS&P 500,tRS&P 500)
1. Feb 28, 2019 5.26% 2.97% 23.19 3.49 8.99
2. Mar 31, 2019 -4.91% 1.79% 28.71 0.47 -3.68
3. Apr 30, 2019 -3.78% 3.93% 17.82 7.98 -11.93
4. May 31, 2019 -8.82% -6.58% 85.90 59.04 71.21
5. Jun 30, 2019 15.22% 6.89% 218.34 33.49 85.51
6. Jul 31, 2019 -7.46% 1.31% 62.55 0.04 -1.64
7. Aug 31, 2019 -8.78% -1.81% 85.12 8.50 26.89
8. Sep 30, 2019 2.41% 1.72% 3.84 0.37 1.20
9. Oct 31, 2019 3.89% 2.04% 11.88 0.88 3.23
10. Nov 30, 2019 -1.32% 3.40% 3.10 5.28 -4.05
11. Dec 31, 2019 0.24% 2.86% 0.04 3.07 -0.36
12. Jan 31, 2020 -8.31% -0.16% 76.72 1.61 11.11
13. Feb 29, 2020 -9.78% -8.41% 104.54 90.57 97.31
14. Mar 31, 2020 -13.91% -12.51% 206.21 185.44 195.55
15. Apr 30, 2020 7.16% 12.68% 45.04 134.06 77.71
16. May 31, 2020 4.54% 4.53% 16.79 11.71 14.02
17. Jun 30, 2020 13.65% 1.84% 174.26 0.54 9.68
18. Jul 31, 2020 19.69% 5.51% 370.39 19.40 84.76
19. Aug 31, 2020 5.42% 7.01% 24.74 34.82 29.35
20. Sep 30, 2020 -0.15% -3.92% 0.36 25.29 3.01
21. Oct 31, 2020 -1.36% -2.77% 3.25 15.00 6.98
22. Nov 30, 2020 17.74% 10.75% 298.94 93.10 166.83
23. Dec 31, 2020 -3.79% 3.71% 17.98 6.79 -11.05
24. Jan 31, 2021 -0.36% -1.11% 0.65 4.93 1.79
25. Feb 28, 2021 7.28% 2.61% 46.66 2.26 10.27
26. Mar 31, 2021 13.78% 4.24% 177.85 9.85 41.85
27. Apr 30, 2021 1.61% 5.24% 1.35 17.11 4.81
28. May 31, 2021 -0.77% 0.55% 1.48 0.31 0.68
29. Jun 30, 2021 -6.26% 2.22% 44.93 1.24 -7.48
30. Jul 31, 2021 2.35% 2.27% 3.62 1.37 2.22
31. Aug 31, 2021 -3.89% 2.90% 18.83 3.22 -7.78
32. Sep 30, 2021 -8.75% -4.76% 84.60 34.37 53.92
33. Oct 31, 2021 -2.52% 6.91% 8.80 33.74 -17.23
34. Nov 30, 2021 4.95% -0.83% 20.27 3.76 -8.73
35. Dec 31, 2021 0.38% 4.36% 0.00 10.60 -0.22
36. Jan 31, 2022 12.92% -5.26% 155.61 40.51 -79.39
37. Feb 28, 2022 -3.26% -3.14% 13.72 17.99 15.71
38. Mar 31, 2022 -8.64% 3.58% 82.52 6.11 -22.45
39. Apr 30, 2022 -4.66% -8.80% 26.07 98.04 50.55
40. May 31, 2022 2.56% 0.01% 4.46 1.21 -2.32
41. Jun 30, 2022 -12.03% -8.39% 155.70 90.21 118.51
42. Jul 31, 2022 16.66% 9.11% 262.95 64.09 129.82
43. Aug 31, 2022 -5.90% -4.24% 40.31 28.62 33.96
44. Sep 30, 2022 -15.44% -9.34% 252.44 109.11 165.96
45. Oct 31, 2022 10.85% 7.99% 108.35 47.34 71.62
46. Nov 30, 2022 6.93% 5.38% 42.07 18.23 27.69
47. Dec 31, 2022 -6.42% -5.90% 47.09 49.04 48.06
48. Jan 31, 2023 8.36% 6.18% 62.63 25.70 40.12
49. Feb 28, 2023 -1.10% -2.61% 2.38 13.82 5.74
50. Mar 31, 2023 3.92% 3.51% 12.05 5.76 8.33
51. Apr 30, 2023 -5.84% 1.46% 39.50 0.13 -2.25
52. May 31, 2023 -6.41% 0.25% 47.02 0.74 5.88
53. Jun 30, 2023 13.73% 4.71% 176.46 13.02 47.93
54. Jul 31, 2023 -3.14% 4.85% 12.85 13.99 -13.41
55. Aug 31, 2023 -2.47% -1.77% 8.53 8.28 8.40
56. Sep 30, 2023 -7.16% -4.87% 57.85 35.73 45.47
57. Oct 31, 2023 -12.18% -2.20% 159.30 10.92 41.70
58. Nov 30, 2023 7.51% 8.92% 49.92 61.03 55.20
59. Dec 31, 2023 6.88% 4.42% 41.40 11.00 21.34
Total (Σ): 4,149.94 1,634.30 1,756.92

Show all

VarianceGLW = Σ(RGLW,tRGLW)2 ÷ (59 – 1)
= 4,149.94 ÷ (59 – 1)
= 71.55

VarianceS&P 500 = Σ(RS&P 500,tRS&P 500)2 ÷ (59 – 1)
= 1,634.30 ÷ (59 – 1)
= 28.18

CovarianceGLW, S&P 500 = Σ(RGLW,tRGLW)×(RS&P 500,tRS&P 500) ÷ (59 – 1)
= 1,756.92 ÷ (59 – 1)
= 30.29


Systematic Risk (β) Estimation

Microsoft Excel
VarianceGLW 71.55
VarianceS&P 500 28.18
CovarianceGLW, S&P 500 30.29
Correlation coefficientGLW, S&P 5001 0.67
βGLW2 1.08
αGLW3 -0.74%

Calculations

1 Correlation coefficientGLW, S&P 500
= CovarianceGLW, S&P 500 ÷ (Standard deviationGLW × Standard deviationS&P 500)
= 30.29 ÷ (8.46% × 5.31%)
= 0.67

2 βGLW
= CovarianceGLW, S&P 500 ÷ VarianceS&P 500
= 30.29 ÷ 28.18
= 1.08

3 αGLW
= AverageGLW – βGLW × AverageS&P 500
= 0.45%1.08 × 1.11%
= -0.74%


Expected Rate of Return

Microsoft Excel
Assumptions
Rate of return on LT Treasury Composite1 RF 4.67%
Expected rate of return on market portfolio2 E(RM) 13.79%
Systematic risk (β) of Corning Inc. common stock βGLW 1.08
 
Expected rate of return on Corning Inc. common stock3 E(RGLW) 14.47%

1 Unweighted average of bid yields on all outstanding fixed-coupon U.S. Treasury bonds neither due or callable in less than 10 years (risk-free rate of return proxy).

2 See details »

3 E(RGLW) = RF + βGLW [E(RM) – RF]
= 4.67% + 1.08 [13.79%4.67%]
= 14.47%