That's because Jabil is benefiting from the popularity of Apple's iPhone 6 and from growth in its diversified manufacturing services segment, a business that makes casings for iPhones.
The company is scheduled to report results for its fiscal first quarter on Wednesday. In September, Jabil estimated that revenue from its diversified manufacturing services segment would increase 6% during the quarter, while revenue from its electronics-manufacturing segment would decline by 5%. Diversified manufacturing services now accounts for 40% of Jabil's total revenue. Overall for its fiscal year ending in August, the company projected earnings of $1.65 to $1.95 a share.
Cisco, an important customer, is coming off a solid quarter, and BlackBerry (BBRY) , another customer, has recovered under new CEO John Chen, another sign that bodes well for Jabil.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.TEXT TheStreet Ratings team rates JABIL CIRCUIT INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate JABIL CIRCUIT INC (JBL) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strongest point has been its a solid financial position based on a variety of debt and liquidity measures that we have looked at. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins."
You can view the full analysis from the report here: JBL Ratings Report