Jabil Circuits is a Fortune 150 company, based in St. Petersburg, FL, with over $35 billion in annual revenue. A worldwide electronics manufacturer, designer, and supply chain provider, Jabil provides tailored products to over 300 well-known brands in the areas of mobile phones, packaging, healthcare diagnostic equipment, logistics, automation, and coffee machines. Among the 16 industries served are smart home, automotive, cloud, defense, and aerospace, payment solutions, printing, and photonics.
The company has facilities in 30 countries with over 260,000 employees and more than 27,000 supplier relationships. Its objective is to be the “most technologically advanced and trusted manufacturing solutions provider” to its global customer base. This outcome will result from their large investment in robotics, factory floor automation, and machine learning.
On September 27, 2022, Jabil reported another quarter of solid earnings with net quarterly revenue of $9 billion ($35.5 billion for the fiscal year 2022), Electronics Manufacturing Services year-on-year revenue growth of 32%, and operating income of $409 million. The company also announced a $1 billion stock repurchase plan since the company has the commitment to return capital to shareholders.
The stock price hit an all-time high of $73.33 on December 1, 2022. It has since backed off a bit to around $71 on December 7, after a big run-up from $55.29 on October 13. Since the beginning of 2022, JBL is up 1.1% compared to the Nasdaq Composite’s loss of 29.6%, which is an exceptional relative performance. Typically, stocks that break out to new all-time highs, especially during bear markets, tend to go much higher when the bull market returns. The average 50-day daily trading volume of 1.1 million shares is more than sufficient for trading liquidity and low bid-to-ask spreads.
JBL is ranked third in VectorVest’s electronics (miscellaneous) industry grouping out of 48 stocks, and is ranked in the top 10% of stocks in the entire electronics business sector showing its strong relative strength compared to its competitors.
The VectorVest ratings of JBL are as follows:
- Excellent Upside Potential: The Relative Value (RV) rating focuses on a stock’s long-term, three-year price appreciation potential. The current RV rating for JBL is 1.45 – well above the 1.00 level on a scale of 0.00-2.00. VectorVest’s current value of the stock is $88.25 compared to its current price of $70.56, therefore it is considered undervalued.
- Fair Safety: The Relative Safety (RS) rating is based on the company’s business longevity, financial predictability/consistency, debt-to-equity ratio, and additional risk parameters, including price volatility. The RS rating of 1.07 is slightly above average, indicating a low risk.
- Very Good Timing: The Relative Timing (RT) rating focuses on the price trend over the short, medium, and long-term. The components include price direction, dynamics, and price magnitude of price changes over daily, weekly, quarterly, and yearly comparisons. JBL has an above-average RT rating of 1.26. As the accompanying chart shows, JBL hit a new all-time high on December 1 and is above its 40-day moving average.
- Poor Comfort Index: This index measures the consistency of a stock’s long-term resistance to severe and lengthy corrections. This index compares the individual stock to the fluctuation of the VectorVest Composite and is measured on a scale of 0 to 2.00. At a level of 0.58, clearly, JBL has a below-average rating. This low rating is not surprising, as it is a very volatile stock in a volatile sector.
- Excellent Earnings Growth Rate (GRT): JBL’s 26% forecasted growth rate is well above average and is measured over a forecasted three-year period. This fundamental factor is calculated in the VectorVest software so you don’t have to do the work. Its chart highlights the up-trending earnings and price movement. It has an $8.14 forecasted earnings per share.
- Very Good VST Score: The VST Master Indicator ranks nearly 9,200 stocks from high to low and brings to the top of the rankings those stocks with the highest VST scores. JBL score is 1.26. and is an example of the benefit of using the VectorVest analysis software to find the cream of the crop with a few mouse clicks.
All things considered, is this a good time to buy JBL as it is near its all-time high? To get the answer you can analyze JBL free using VectorVest to get the current buy, sell or hold recommendation.
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