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Jabil Circuit Inc. (JBL - Analyst Report) is scheduled to release its fiscal first quarter 2012 results after the closing bell on December 19, 2012. In the run up to the earnings results, we did not notice any movement in analysts’ estimates for the quarter.

Prior Quarter Highlights

Jabil reported mixed fourth quarter 2012 results. Although earnings of 44 cents (including stock-based compensation of $21.3 million) missed the Zacks Consensus Estimate by 6 cents, revenue of $4.34 billion was well ahead of the consensus mark.

Gross profit declined 3.5% year over year to $317.5 million, while gross margin contracted 40 basis points (“bps”) year over year to 7.3%. Higher operating expenses had a negative impact on profitability in the quarter. Operating income (including stock-based compensation of $21.6 million) decreased 13.5% year over year to $147.7 million. Operating margin was 3.4% compared with 4.0% in the year-earlier quarter.

For further details please see Mixed 4Q for Jabil.

Estimates Revision Trend

Over the past 30 days, none of the five analysts covering the stock made any revision to their estimates. Thus, the Zacks Consensus Estimate for the first quarter of 2013 remained static at 47 cents, which is down 16% from 58 cents reported in the year-ago quarter.

No revision was also noticed for the second quarter of 2013, fiscal 2013 and fiscal 2014 with the corresponding Zacks Consensus Estimates at 50 cents (up 4.2% year over year), $2.17 (up 7.4% year over year) and $2.62 (up 20.7% year over year), respectively.

Our Take

Jabil has failed to beat the Zacks Consensus Estimate in the last four quarters. The company’s results have been negatively impacted by higher operating expenses and weak performance from two of its main customers, Research In Motion and Cisco Systems (CSCO - Analyst Report). Moreover, a sluggish macro environment has also hurt Jabil’s top-line growth.

Although we don’t expect the scenario to change much in the near term, Jabil’s increasing exposure to Apple (AAPL - Analyst Report), better-than-expected first quarter 2013 results from Cisco and the upcoming new product release (Blackberry 10) from RIMM bode well for the company going forward. 

Thus, we remain Neutral over the long term (6-12 months). Currently, Jabil has a Zacks #3 Rank (Hold).

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