Investopedia: Is Jabil Quietly Loading Both Barrels?

Investors should be careful to place only a very few stocks in the "permanently uninvestable" box. Typically this is reserved for companies where management is untrustworthy, the business is in inexorable decline or the cyclicality is just too much to bear. While I confess to being quite hard on Jabil Circuit (NYSE:JBL) in the past and very nearly putting it in that dreaded box, this company may actually be shaping up as an interesting play for the next few years.

A Solid Close to the Year  

Part of my skepticism on Jabil has been based on the company's customer list. Right now, if you rely on Cisco (Nasdaq:CSCO), Research In Motion (Nasdaq:RIMM) and NetApp (Nasdaq:NTAP) for meaningful revenue dollars, you cannot be feeling too good. And yet, Jabil managed to post a very solid quarter all the same - testament, perhaps, to the company's diversity of clients and markets.

Read more here:
http://stocks.investopedia.com/stock-analysis/2011/Is-Jabil-Quietly-Loading-Both-Barrels-JBL-CSCO-RIMM-NTAP-FLEX-JNJ-CLS0929.aspx

Investopedia: Now May Be The Time For Jabil

There are plenty of valid reasons to take one look at an EMS provider like Jabil Circuit (NYSE:JBL), Flextronics (Nasdaq:FLEX) or Celestica (NYSE:CLS) and not bother again. After all, this is a highly cyclical market where the companies have minimal control over their own revenue, narrow margins and returns on capital that arguably do not cover their cost of capital. 


And yet, savvy investors realize that there may be a time and place for almost any stock. With the tech market in the doldrums and several major customers gasping, Jabil should be in rough shape. Oddly enough, the company is doing relatively well and may in fact be worth a look from investors who understand that this would not be a permanent engagement.

Decent Third-Quarter Performance
Third-quarter results at Jabil were not too bad, particularly given the weakness at customers like Research In Motion (Nasdaq:RIMM) and Cisco (Nasdaq:CSCO). Revenue rose 22% from the year-ago level, and 8% from the prior quarter, surpassing the consensus estimate by almost $100 million. Growth was strong in the Enterprise and Infrastructure and Diversified Manufacturing Services units, and those offset weakness in High Velocity Systems.
 

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http://stocks.investopedia.com/stock-analysis/2011/Now-May-Be-The-Time-For-Jabil-JBL-FLEX-CLS-RIMM-AAPL0624.aspx

Investopedia: Can Jabil Take The Next Step?

There is a certain cyclical rhythm in the electronics manufacturing services (EMS) space. Orders are cut in the bad times and clients will in-source manufacturing to boost their own utilization rates. Then, as things get better, the cycle reverses and EMS companies once again see more business. As this process unfolds, revenue rises, margins improve and estimates move higher. Last and not least, even the EMS companies come up against capacity constraints, the industry peaks, and the whole cycle starts anew. 

Every cyclical industry has periods where the stocks tend to outperform, and investors can do well if they time their buys and sells appropriately. Turning to Jabil Circuit (NYSE:JBL), then, the question is whether there is still reason to hope for improvement and more momentum in the story.

A Fine Second Quarter 

Although there have been some growth concerns around major Jabil clients like Cisco (Nasdaq:CSCO) and Research In Motion (Nasdaq:RIMM), Jabil nevertheless produced a respectable quarter. Revenue grew 31% from last year and surpassed the average analyst estimate.

Below the top line, Jabil delivered some of the results that an investor would expect in that more favorable back half of the EMS cycle. Gross margin was only slightly better than in the year-ago period, but the company wrung very solid leverage out of its SG&A spending, which fueled growth in adjusted operating income of 76% (or 69% in GAAP operating income).  

To read the full piece, please go to:
http://stocks.investopedia.com/stock-analysis/2011/Can-Jabil-Take-The-Next-Step-JBL-CSCO-RIMM-BSX-JNJ-FLEX-CLS0324.aspx