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Bear of the Day: Jabil Inc. (JBL)

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Jabil Inc. ((JBL - Free Report) ) is a manufacturing solutions firm staring down slowing demand across multiple end markets.

Jabil shares have fallen roughly 30% since JBL’s second quarter FY24 earnings release in mid-March, and its most recent EPS estimates came in below its already beaten-down consensus for next year.

Jabil Stock Basics

 

Jabil provides manufacturing services to companies in telecommunications and tons of other industries. Jabil helps its customers make everything from smartphones and home appliances to healthcare tech, and beyond.

Jabil serves original equipment manufacturers and product companies across multiple industries and end markets, including compute & storage, automotive, telecom, energy & industrial, and more.

Jabil’s client list features giants of critical and game-changing industries, including Apple (AAPL - Free Report) . Apple reportedly made up 17% of Jabil’s revenue during its fiscal 2023.

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Jabil’s diversification and expertise helped it grow steadily for years, including 12% average revenue growth between FY18 and FY22. The company then posted just a 4% sales expansion in FY23 (the period ended August 31, 2023).

Jabil provided downbeat earnings guidance throughout the first three quarters of its fiscal 2024. Jabil divested its Mobility business this fiscal year and “experienced softness across multiple end markets.”

Jabil’s downward earnings revisions help it earn a Zacks Rank #5 (Strong Sell) right now. Jabil’s most accurate/recent EPS estimate for FY25 came in 3% below its current consensus, which is already down 14% since its Q3 release in late June.

Bottom Line on JBL Stock Right Now

 

JBL stock has outperformed the Zacks Tech sector over the last decade. On top of that, Jabil stands to expand alongside growth trends such as data center power and cooling, semi-cap equipment, and beyond.

Still, Jabil stock has fallen nearly 30% since its second quarter FY24 earnings release in mid-March and 14% YTD. JBL shares are trading below their 21-week and 50-week moving averages, and its Electronics - Manufacturing Services space is in the bottom 16% of over 250 Zacks industries.

Investors might want to stay away from Jabil stock until it releases its fourth quarter FY24 financial results on September 26 and provides updated guidance. 


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