UPDATE: Jabil Circuit (JBL) on Watch Ahead of Apple Event; Needham Upgrades to Strong Buy

September 10, 2013 9:21 AM EDT Send to a Friend
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Price: $17.60 --0%

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(Updated - September 10, 2013 11:47 AM EDT)

Needham & Company upgraded Jabil Circuit (NYSE: JBL) from Buy to Strong Buy with a price target of $28 (from $24). Analyst Sean K.F. Hannan expects record EPS in 2014, with strong gains at Apple (Nasdaq: AAPL).

"We continue to view JBL as our top pick in EMS due to valuation, current positioning, and our catalyst expectations. JBL navigated through bumps in F13 with a slight step back from an EPS perspective, but we believe a stronger foundation was created for meaningful steps going forward. With Nypro bringing the MTG group some scale in Medical and Industrial, and our expectations for share gains ahead at AAPL, we expect record EPS in F14 with momentum continuing," said Hannan.

Hannan believes Apple's event today could provide a catalyst for Jabil, as Jabil is supplier for both the iPhone 5S and iPhone 5C.

On share gains, Hannan said, "The relationship between AAPL & Foxconn/Hon Hai - N/R (had ~80% share for materials) is not as strong as it was in the past (well publicized). Now, we believe JBL+Nypro consumer capacity has put JBL in a particularly strong position to capitalize on this dynamic and serve as source for dual material tracks; we see momentum moving in JBL's favor. Recall, small share ceded by Foxconn/Hon Hai is very meaningful for JBL."

For an analyst ratings summary and ratings history on Jabil Circuit click here. For more ratings news on Jabil Circuit click here.

Shares of Jabil Circuit closed at $23.38 yesterday.




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