Analysts Respond to Better-Than-Expected Q4 Sales from Jabil (JBL)
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Price: $313.51 -0.99%
Rating Summary:
15 Buy, 4 Hold, 0 Sell
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Up: 8 | Down: 5 | New: 26
Rating Summary:
15 Buy, 4 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Jabil Circuit (NYSE: JBL) reported its fourth-quarter results well above expectations Tuesday afternoon. The company posted $4.28 billion in sales and earnings per share of $0.62, versus the consensus of $4.19 billion and $0.56. Operating margins rose 20 bps quarter over quarter on a better mix in the HVS segment and stronger overall sales.
Management highlighted an impact from the slowing macro environment, but made no comment on expectations for the full year. The company released its first-quarter outlook: sales ranging from $4.3 billion to $4.5 billion, versus the consensus of $4.41 billion, and EPS of $0.62 to $0.70, versus the consensus of $0.61.
On the analyst front, most analysts remain bullish.
Deutsche said the upside to Jabil's quarter was driven by better-than-expected results in the DMS and HVS segments. The firm believes management’s guidance indicates slightly lower than “typical seasonal patterns” in the HVS segment and lower margins in the E&I segment.
The firm's $0.54 and $2.13 EPS estimates for the first quarter and fiscal 2012, respectively, are maintained. For 2013, the firm sees earnings of $2.50 per share. Revenue for fiscal 2012 and 2013 are estimated to be $17.77 billion and $19.97 billion, respectively.
Analysts at Deutsche Bank reiterated a Hold rating and $19 price target on shares of Jabil.
While Goldman Sachs continues to rate shares of JBL at Buy, the firm lowered its price target from $23 to $21. Goldman said its bullish rating is based on the company’s ability to drive earnings and sales. The firm noted a majority of the earnings upside was the result of buybacks and an improving product mix.
Goldman tweaked its 2012 EPS estimate from $2.29 to $2.32 and its 2013 estimate from $2.68 to $2.67. The firm's sales estimates reduced from $17.999 billion and $19.621 billion to $17.841 billion and $19.455 billion, respectively. Goldman introduced a 2014 earnings estimate of $3.01 per share and and a sales estimate of $21.087 billion.
One Goldman analyst said, “We believe JBL’s ongoing expansion of its DMS business and the positive implications for margins and EPS remain under-appreciated. And, while the company’s exposure to RIM (Nasdaq: RIMM) weighs on investor sentiment today, successful diversification away from RIM and toward DMS is likely to ultimately drive JBL’s valuation multiple higher.”
Collins Stewart believes, based on the company’s performance in the previous quarter and insight into November, shares of Jabil should be trading above a 7x multiple.
The firm said, “Our PDR on tech demand has suggested that despite concerning macro headlines, business continues to close in the US & in Europe broadly across industry sectors including storage & servers. The weak link right now is the financial vertical in the US. Somewhat offsetting this weakness is sequential improvement in Federal spending as the FY closes.”
The firm is reaffirming its Buy rating and $25 price target on shares of JBL.
Management highlighted an impact from the slowing macro environment, but made no comment on expectations for the full year. The company released its first-quarter outlook: sales ranging from $4.3 billion to $4.5 billion, versus the consensus of $4.41 billion, and EPS of $0.62 to $0.70, versus the consensus of $0.61.
On the analyst front, most analysts remain bullish.
Deutsche said the upside to Jabil's quarter was driven by better-than-expected results in the DMS and HVS segments. The firm believes management’s guidance indicates slightly lower than “typical seasonal patterns” in the HVS segment and lower margins in the E&I segment.
The firm's $0.54 and $2.13 EPS estimates for the first quarter and fiscal 2012, respectively, are maintained. For 2013, the firm sees earnings of $2.50 per share. Revenue for fiscal 2012 and 2013 are estimated to be $17.77 billion and $19.97 billion, respectively.
Analysts at Deutsche Bank reiterated a Hold rating and $19 price target on shares of Jabil.
While Goldman Sachs continues to rate shares of JBL at Buy, the firm lowered its price target from $23 to $21. Goldman said its bullish rating is based on the company’s ability to drive earnings and sales. The firm noted a majority of the earnings upside was the result of buybacks and an improving product mix.
Goldman tweaked its 2012 EPS estimate from $2.29 to $2.32 and its 2013 estimate from $2.68 to $2.67. The firm's sales estimates reduced from $17.999 billion and $19.621 billion to $17.841 billion and $19.455 billion, respectively. Goldman introduced a 2014 earnings estimate of $3.01 per share and and a sales estimate of $21.087 billion.
One Goldman analyst said, “We believe JBL’s ongoing expansion of its DMS business and the positive implications for margins and EPS remain under-appreciated. And, while the company’s exposure to RIM (Nasdaq: RIMM) weighs on investor sentiment today, successful diversification away from RIM and toward DMS is likely to ultimately drive JBL’s valuation multiple higher.”
Collins Stewart believes, based on the company’s performance in the previous quarter and insight into November, shares of Jabil should be trading above a 7x multiple.
The firm said, “Our PDR on tech demand has suggested that despite concerning macro headlines, business continues to close in the US & in Europe broadly across industry sectors including storage & servers. The weak link right now is the financial vertical in the US. Somewhat offsetting this weakness is sequential improvement in Federal spending as the FY closes.”
The firm is reaffirming its Buy rating and $25 price target on shares of JBL.
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