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Corning (GLW) shares are trading higher today ahead of the company’s Q2 earnings report due before the start of trading tomorrow. The Street consensus is for revenue of $1.72 billion and EPS of 49 cents a share; the company’s guidance was for $1.71 billion to $1.75 billion in revenue and profits of 47-50 cents a share.

Citigroup’s Jim Suva this morning launched coverage of Corning (GLW) with a Hold rating and $23.50 price target, noting that “demand risks are rising” for the LCD glass maker.

Suva writes that GLW faces “multiple slowing derivatives ahead,” with flattish gross margins as LCD manufacturing leverage peaks, slowing EPS growth and a potentially weaker economy pressuring consumer demand for LCD TVs. “Given the outsized contribution of LCD to profits and EPS, we see little room for EPS acceleration, and thus limited multiple expansion,” he writes.

The Street continues to adjust its outlook for Corning (GLW) in the wake of disappointing results and indications of rising inventories this week from LCD panel makers AU Optronics (AUO) and LG Display (LPL).

The latest to weigh in on the situation is RBC Capital’s Mark Sue, who today cut his price target on GLW to $24 from $30. He slightly trimmed his EPS estimate for the company, and now sees 2008 profits of $1.88 a share, down a penny from his previous forecast; he also sees $1.88 in 2009, down two cents from his old estimate. (The Street sees $1.92 this year, $2 next year.)

Corning (GLW) shares are down again today, with a new round of concerns about weakening end-market demand.

Yesterday, the stock was down sharply after the glass maker’s largest customer, LCD panel maker AU Optronics (AUO), reported weaker-than-expected results in June.

There are new signs of weakness in the flat-panel TV business.