Opinions
Kevin Simpson
Jabil Circuit
JBL-N
PARTIAL BUY
Jun 18, 2025
Stock price when the opinion was issued
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The problem he is having with this is the same problem he is having with many of the others in the contract manufacturing space. The margins are so thin. Their pre-tax margin is about 3%, so if they make a mistake, it costs them a lot and there is not a lot of opportunity to make up profit.
He just bought it. It's cheap at 10x forward earnings. They're in a hot business--a in logistics and supply chains. A very cheap stock. They've gotten into new markets. It's low-risk given the low multiple. They will guide to an earnings number of $10/share. Earnings will be released on Wednesday. This is a long-term hold.
Premium contentJabil is a manufacturing solutions provider with over 260,000 employees across 100 locations in 30 countries. The world's leading brands rely on Jabil's unmatched breadth and depth of end-market experience, technical and design capabilities, manufacturing know-how, supply chain insights and global product management expertise. Driven by a common purpose, Jabil and its people are committed to making a positive impact on their local community and the environment.
They provide outsource manufacturing for all sorts of businesses, from healthcare to autos and data centres. They just reported a blowout quarter and raised their forecast. But the stock sold off 7% in one day. Their revenue guidance was conservative, so it sold, but he suspects there was profit-taking.
Just bought it before earnings--beating top and bottom lines, with a 16% YOY revenue jump. Management increased the YOY top and bottom line. But it's up a lot so be careful.