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.
Jabil (JBL) Q2 Earnings and Revenues Surpass Estimates
Read MoreHide Full Article
Jabil Inc. (JBL - Free Report) reported better-than-expected fiscal second-quarter 2018 results wherein both the top and the bottom line surpassed the Zacks Consensus Estimate and recorded year-over-year improvement.
The company reported earnings of 66 cents per share, which beat the Zacks Consensus Estimate by 4 cents and were much higher than the prior-year quarter’s figure of 49 cents. The figure was also better than the mid-point of the guided range of 50-74 cents per share due to a favorable tax rate.
Revenues increased 19.2% year over year to $5.301 billion and outpaced the Zacks Consensus Estimate of $4.911 billion as well. The figure surpassed the guided range of $4.75–$5.05 billion, driven by wins in EMS segment and better-than-expected results of the company’s Green Point business.
Electronics Manufacturing Services (EMS) revenues (representing 54% of revenues) were up 7% year over year to $2.9 billion backed by growing number of customers in capital equipment, industrial, energy and automotive sectors.
Diversified Manufacturing Services (DMS) revenues (46% of revenues) increased 38% year over year to approximately $2.4 billion, driven by strength in mobility, lifestyles and healthcare businesses.
Operating Details
Gross margin contracted nearly 70 basis points (bps) on a year-over-year basis to 7.5%.
The company’s core operating income increased 17.8% year over year to $178.6 million. However, core operating margin remained unchanged at 3.4%. Increase in investments in the EMS segment coupled with cost overshoot in the packaging business impacted margins.
Balance Sheet & Cash Flow
The company exited the quarter with cash and cash equivalents of $940.8 million compared with $746.3 million in the previous quarter.
In the quarter, cash flow from operations was $352 million. Cash flow from operations for the first six months of the year was $298.2 million compared with $346.2 million in the year-ago period.
Jabil repurchased $132 million worth of shares in the quarter. At the end of the quarter, the company had $225 million outstanding under the current stock repurchase authorization.
For the third quarter, Jabil expects total revenues to increase 9% (at mid-point) year over year in the range of $4.75–$5.05 billion. Core operating income is estimated in the range of $125–$165 million.
DMS revenues are forecast to grow 10% year over year to $1.85 billion.
EMS revenues are anticipated to increase 8% on a year-over-year basis to $3.05 billion.
The company is expected to post core earnings in the range of 35–55 cents per share on a non-GAAP basis.
For the second half of fiscal 2018, the company projects core EPS to grow in the range of 20-25%.
Jabil anticipates $30 million of restructuring expenses in the second half of fiscal 2018. It expects to achieve $20 million to $30 million in cost savings in fiscal 2019.
Long-term earnings growth for NVIDIA, Lam Research and Paycom is projected to be 10.3%, 14.9% and 25.8%, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Jabil (JBL) Q2 Earnings and Revenues Surpass Estimates
Jabil Inc. (JBL - Free Report) reported better-than-expected fiscal second-quarter 2018 results wherein both the top and the bottom line surpassed the Zacks Consensus Estimate and recorded year-over-year improvement.
The company reported earnings of 66 cents per share, which beat the Zacks Consensus Estimate by 4 cents and were much higher than the prior-year quarter’s figure of 49 cents. The figure was also better than the mid-point of the guided range of 50-74 cents per share due to a favorable tax rate.
Revenues increased 19.2% year over year to $5.301 billion and outpaced the Zacks Consensus Estimate of $4.911 billion as well. The figure surpassed the guided range of $4.75–$5.05 billion, driven by wins in EMS segment and better-than-expected results of the company’s Green Point business.
Jabil, Inc. Revenue (TTM)
Jabil, Inc. Revenue (TTM) | Jabil, Inc. Quote
Top-Line Details
Electronics Manufacturing Services (EMS) revenues (representing 54% of revenues) were up 7% year over year to $2.9 billion backed by growing number of customers in capital equipment, industrial, energy and automotive sectors.
Diversified Manufacturing Services (DMS) revenues (46% of revenues) increased 38% year over year to approximately $2.4 billion, driven by strength in mobility, lifestyles and healthcare businesses.
Operating Details
Gross margin contracted nearly 70 basis points (bps) on a year-over-year basis to 7.5%.
The company’s core operating income increased 17.8% year over year to $178.6 million. However, core operating margin remained unchanged at 3.4%. Increase in investments in the EMS segment coupled with cost overshoot in the packaging business impacted margins.
Balance Sheet & Cash Flow
The company exited the quarter with cash and cash equivalents of $940.8 million compared with $746.3 million in the previous quarter.
In the quarter, cash flow from operations was $352 million. Cash flow from operations for the first six months of the year was $298.2 million compared with $346.2 million in the year-ago period.
Jabil repurchased $132 million worth of shares in the quarter. At the end of the quarter, the company had $225 million outstanding under the current stock repurchase authorization.
Jabil, Inc. Price, Consensus and EPS Surprise
Jabil, Inc. Price, Consensus and EPS Surprise | Jabil, Inc. Quote
Guidance
For the third quarter, Jabil expects total revenues to increase 9% (at mid-point) year over year in the range of $4.75–$5.05 billion. Core operating income is estimated in the range of $125–$165 million.
DMS revenues are forecast to grow 10% year over year to $1.85 billion.
EMS revenues are anticipated to increase 8% on a year-over-year basis to $3.05 billion.
The company is expected to post core earnings in the range of 35–55 cents per share on a non-GAAP basis.
For the second half of fiscal 2018, the company projects core EPS to grow in the range of 20-25%.
Jabil anticipates $30 million of restructuring expenses in the second half of fiscal 2018. It expects to achieve $20 million to $30 million in cost savings in fiscal 2019.
Zacks Rank & Stocks to Consider
Jabil Circuit carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader technology sector include NVIDIA Corporation (NVDA - Free Report) , Lam Research Corporation (LRCX - Free Report) and Paycom Software (PAYC - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth for NVIDIA, Lam Research and Paycom is projected to be 10.3%, 14.9% and 25.8%, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>