We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Businesses built for the new economy have been investors’ bullish focus in recent weeks, as stock-picking begins to reveal itself as the primary market theme for 2022. I think it’s about time to add a next-generation industrial play to your portfolio mix as nations look to bring operations back home (economic independence through reversing globalization).
Jabil (JBL - Free Report) , a leading manufacturer of highly diversified new economy partners, is perfectly positioned for this onshoring push as the world rapidly deglobalizes in the wake of the commencing digital renaissance the pandemic has accelerated (with new technology allowing the reversal of globalized operations to be possible).
Jabil has been exhibiting margin expanding growth throughout the pandemic, which is set to accelerate in the post-pandemic world as demand for its broad-based portfolio of future-focused international manufacturing operations allows it to take a controlling position amid the impending digital renaissance of the commencing 4th Industrial Revolution.
The acceleration of nationalization in the face of the Russia-Ukraine war, years of pandemic-fueled digital adaptation, JBL’s breakout above its 50-day and 200-day moving average, and increasingly bullish analysts’ estimates following a blowout earnings report in the back half of last week, JBL shares are a ripe new economy play for your future-focused portfolio.
JBL is a Zacks Rank #2 (Buy) with every covering analyst calling the stock a strong buy today, with price targets centering tightly around $80 a share.
Let’s dive into this new economy investment opportunity.
Jabil’s Operations
Jabil is a multinational manufacturing giant that not only provides best-in-class manufacturing capabilities, but technical & design expertise, and top-notch sourcing/supply chain knowledge that would benefit any business amid this global resource shortage. This conglomerate operates across 100 locations in 30 different countries, with 260,000 employees (creating local jobs at each specialized site).
Jabil (JBL - Free Report) has proven its secular growth narrative over the past 5 years, having generated year-over-year topline growth in the past 21 consecutive quarters, which is expected to continue in the post-pandemic world.
This company’s operations were seemingly unaffected by the pandemic’s wrath, as this exceptionally flexible manufacturer appears to have only benefited from the digitalizing tailwind that this devastating virus fortuitously generated.
Jabil’s highly diverse portfolio of manufacturing services has hedged its operations against most broader market risks with defined end-markets that have been split up into 2 segments.
Diversified Manufacturing: Healthcare & Packaging, Connected Devices, Mobility, and Auto & Transportation.
Electronic Manufacturing: 5G Wireless & Cloud, Industrial & Semiconductors, Digital Print & Retail, and Network & Storage.
These complementary segments have been reliably growing in a consistent margin expanding way, which points to a level of operational excellence that only a superior management team would be able to achieve.
The Valuation
After an abbreviated 10-week correction to kick off 2022, JBL is off to the races once again in the wake of its bid driving quarterly report in mid-March. Jabil easily beat analysts’ EPS estimates for the 8th successive quarter while providing bullish guidance for the current quarter.
JBL is trading at an investment ripe forward P/E of 8x, its lowest multiple since the depths of the pandemic sell-off two years ago.
This stock is also rocking a PEG (growth adjusted P/E) of 0.67x, representing a sizable discount from both JBL’s 5-year median and industry average, with anything below 1x signifying potential value.
The Chart
JBL has largely traded with the broader markets since 2022 began, with an outsized -27% drawdown from where it started the year. However, JBL’s exceptional fiscal Q2 report (ending in February) gave it a market edge that investors are yet to fully bake into this stock.
The stock’s leap above its 50-day moving average (orange line) in post-earnings price action looked to be a breakout move. Yet, JBL has been unable to break above that 50% retracement level (from its recent bear market decline), leaving it range-bound between $60 and $62.50 for over 2 weeks now.
Image Source: TradingView
Jabil is not a sexy company or stock to trade for that matter, but at this valuation level coupled with its accelerating secular growth outlay, it represents a solid fundamentally-fueled investment opportunity.
JBL shares haven’t traded this buoyantly since the peak of the Dotcom Bubble in September 2000, only this time the company has a proven track record of secular growth (topline expansion through pandemic) and is 7x cheaper from a P/E multiple-basis.
Final Thoughts
The US stock market is the safest place to hold your capital in this highly inflationary (rapidly devaluing cash) rising rate environment (weakening bond values), while earnings growth continues with strong economic demand remaining buoyant. Valuation multiples for many new normal stocks have finally fallen to equitable levels.
With intrinsic valuation modeled denominators (aka enterprise discount rates) now aligning with interest rate expectations (if not exceeding), while earnings estimates point to outsized growth in the quarters ahead, many recently discounted US stocks are looking ripe for the picking.
Jabil is built for this new highly adaptable and rapidly digitalizing economy. It’s time to consider adding JBL to your portfolio as a next-generation manufacturing play as analysts drive up estimates.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Bull Of The Day: Jabil (JBL)
Businesses built for the new economy have been investors’ bullish focus in recent weeks, as stock-picking begins to reveal itself as the primary market theme for 2022. I think it’s about time to add a next-generation industrial play to your portfolio mix as nations look to bring operations back home (economic independence through reversing globalization).
Jabil (JBL - Free Report) , a leading manufacturer of highly diversified new economy partners, is perfectly positioned for this onshoring push as the world rapidly deglobalizes in the wake of the commencing digital renaissance the pandemic has accelerated (with new technology allowing the reversal of globalized operations to be possible).
Jabil has been exhibiting margin expanding growth throughout the pandemic, which is set to accelerate in the post-pandemic world as demand for its broad-based portfolio of future-focused international manufacturing operations allows it to take a controlling position amid the impending digital renaissance of the commencing 4th Industrial Revolution.
The acceleration of nationalization in the face of the Russia-Ukraine war, years of pandemic-fueled digital adaptation, JBL’s breakout above its 50-day and 200-day moving average, and increasingly bullish analysts’ estimates following a blowout earnings report in the back half of last week, JBL shares are a ripe new economy play for your future-focused portfolio.
JBL is a Zacks Rank #2 (Buy) with every covering analyst calling the stock a strong buy today, with price targets centering tightly around $80 a share.
Let’s dive into this new economy investment opportunity.
Jabil’s Operations
Jabil is a multinational manufacturing giant that not only provides best-in-class manufacturing capabilities, but technical & design expertise, and top-notch sourcing/supply chain knowledge that would benefit any business amid this global resource shortage. This conglomerate operates across 100 locations in 30 different countries, with 260,000 employees (creating local jobs at each specialized site).
Jabil (JBL - Free Report) has proven its secular growth narrative over the past 5 years, having generated year-over-year topline growth in the past 21 consecutive quarters, which is expected to continue in the post-pandemic world.
This company’s operations were seemingly unaffected by the pandemic’s wrath, as this exceptionally flexible manufacturer appears to have only benefited from the digitalizing tailwind that this devastating virus fortuitously generated.
Jabil’s highly diverse portfolio of manufacturing services has hedged its operations against most broader market risks with defined end-markets that have been split up into 2 segments.
Diversified Manufacturing: Healthcare & Packaging, Connected Devices, Mobility, and Auto & Transportation.
Electronic Manufacturing: 5G Wireless & Cloud, Industrial & Semiconductors, Digital Print & Retail, and Network & Storage.
These complementary segments have been reliably growing in a consistent margin expanding way, which points to a level of operational excellence that only a superior management team would be able to achieve.
The Valuation
After an abbreviated 10-week correction to kick off 2022, JBL is off to the races once again in the wake of its bid driving quarterly report in mid-March. Jabil easily beat analysts’ EPS estimates for the 8th successive quarter while providing bullish guidance for the current quarter.
JBL is trading at an investment ripe forward P/E of 8x, its lowest multiple since the depths of the pandemic sell-off two years ago.
This stock is also rocking a PEG (growth adjusted P/E) of 0.67x, representing a sizable discount from both JBL’s 5-year median and industry average, with anything below 1x signifying potential value.
The Chart
JBL has largely traded with the broader markets since 2022 began, with an outsized -27% drawdown from where it started the year. However, JBL’s exceptional fiscal Q2 report (ending in February) gave it a market edge that investors are yet to fully bake into this stock.
The stock’s leap above its 50-day moving average (orange line) in post-earnings price action looked to be a breakout move. Yet, JBL has been unable to break above that 50% retracement level (from its recent bear market decline), leaving it range-bound between $60 and $62.50 for over 2 weeks now.
Image Source: TradingView
Jabil is not a sexy company or stock to trade for that matter, but at this valuation level coupled with its accelerating secular growth outlay, it represents a solid fundamentally-fueled investment opportunity.
JBL shares haven’t traded this buoyantly since the peak of the Dotcom Bubble in September 2000, only this time the company has a proven track record of secular growth (topline expansion through pandemic) and is 7x cheaper from a P/E multiple-basis.
Final Thoughts
The US stock market is the safest place to hold your capital in this highly inflationary (rapidly devaluing cash) rising rate environment (weakening bond values), while earnings growth continues with strong economic demand remaining buoyant. Valuation multiples for many new normal stocks have finally fallen to equitable levels.
With intrinsic valuation modeled denominators (aka enterprise discount rates) now aligning with interest rate expectations (if not exceeding), while earnings estimates point to outsized growth in the quarters ahead, many recently discounted US stocks are looking ripe for the picking.
Jabil is built for this new highly adaptable and rapidly digitalizing economy. It’s time to consider adding JBL to your portfolio as a next-generation manufacturing play as analysts drive up estimates.