Jabil Circuit

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When large tech firms need electronics manufactured, they turn to Jabil Circuit ( JBL). The $4.8 billion firm builds everything from consumer electronics to medical devices for customers such as Cisco ( CSCO) and Hewlett-Packard ( HPQ). Jabil benefits in a big way from the fact that most tech firms want to develop products, not deal with the headaches of building them. By establishing an entrenched manufacturing infrastructure, Jabil can typically build products more cheaply than its customers can themselves.

Jabil has put a lot of effort into building its medical device manufacturing business, a unit that comes with deeper margins than consumer electronics and enterprise infrastructure offer. That said, a rising tide of spending among all of the markets Jabil serves should help the firm continue boost its top line and bottom line in 2012 and 2013.

Historically, Jabil has generated significant cash, which more than covers debt obligations and dividend payouts. That leaves room for a bigger payout than the 8 cents that JBL currently delivers to investors.

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-- Written by Jonas Elmerraji in Baltimore.

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At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.

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