Corning Shares See More Than 2% Bump After $1.05 Bln Purchase Agreement With Verizon

Verizon Communications Inc. on Tuesday announced a three-year minimum purchase agreement with Corning Inc for $1.05 billion. Shares of Corning were up more than 2% after the announcement. Verizon shares were up less than 1%. Corning will provide Verizon with up to 12.4 million miles of fiber optic cable each year from 2018 to 2020. The goal is for Verizon to build an architecture of "next-gen" fiber network to support all of its businesses, which it hopes will improve its 4G LTE coverage, speed the deployment of 5G and deliver high-speed broadband to homes and businesses. "Our plans identified a shortfall in fiber supply, and Verizon has been working with business teams to forecast demand and fill supply gaps with existing suppliers," said Verizon Chief Supply Chain Officer Viju Menon in a statement. "Securing the required volume of optical fiber and hardware solutions with Corning will ensure we meet our planned rollout schedules." Shares of Corning have gained 12% in the year to date, while Verizon is down more than 8% and the S&P 500 index has increased nearly 5% so far this year.