Next to the Dow, which is down 3% year to date, Jabil's relative performance isn't so bad. But expand that horizon by six months, and the company's stock is down almost 25%.
The company has had a tough time growing earnings and revenue. This is even though it has the benefit of being a parts supplier to the likes of Apple (AAPL) and Cisco (CSCO). The problem has been weak demand.
There isn't anything management can do if IT spending isn't there. Growth can't be manufactured out of thin air. Although the company absorbed some criticism for ending its relationship with BlackBerry (BBRY), it's not as if BlackBerry ties have been fruitful.
Jabil will report fiscal second-quarter earnings Wednesday. Management needs to convince investors of two things. First and foremost, management will need to set out a clear plan to get revenue heading back in the right direction. This may be a challenge.
In the December quarter, management announced that it has divested its aftermarket segment, which is expected to impede growth for this quarter and possibly next. Management estimated revenue to be in the range of $3.5 billion to $3.7 billion, down 17.0% year over year.
Although management has done a solid job of communicating the company's transition into what is known as diversified manufacturing services, investors are impatient for expected results that haven't arrived.