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Jabil (JBL) to Report Q4 Earnings: What's in the Cards?

Zacks Equity Research

Jabil JBL is set to report fourth-quarter fiscal 2019 results on Sep 24.

Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 3.9%.

In third-quarter fiscal 2019, the company reported adjusted earnings of 57 cents per share, beating the Zacks Consensus Estimate by a penny. Revenues of $6.14 billion increased 12.8% year over year and comfortably surpassed the consensus mark of $6 billion.

For fourth-quarter fiscal 2019, Jabil expects total revenues between $6.3 billion and $6.9 billion. Revenues are expected to improve almost 14% year over year at mid-point.

Moreover, the company’s core earnings are expected to be 76-96 cents per share on a non-GAAP basis.

The Zacks Consensus Estimate for earnings stayed at 86 cents over the past 30 days. The consensus mark for revenues is pegged at $6.61 billion, indicating growth of 14.5% from the year-ago quarter’s reported figure.

Jabil, Inc. Price and EPS Surprise

Jabil, Inc. Price and EPS Surprise

Jabil, Inc. price-eps-surprise | Jabil, Inc. Quote

Let’s see how things are shaping up for this announcement.

Factors to Watch

Jabil’s fiscal fourth-quarter results are expected to benefit from contract wins in healthcare, automotive, cloud and 5G. Moreover, improving end-market diversification is a key catalyst.

The DMS segment is likely to reflect benefits of an improved business mix, driven by Jabil’s impressive diversification efforts. EMS growth is likely to have benefited from new business wins in 5G wireless, cloud and automotive end markets.

However, Jabil’s DMS segment’s performance is expected to suffer from soft mobility business and sluggish spending in the semiconductor capital equipment business. Moreover, increasing competition in the industry is weighing on margins.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has a good chance of beating estimates. Meanwhile, the Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

Jabil has a Zacks Rank #3 and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Stocks With Favorable Combination

Here are a few stocks you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.

Micron Technology MU has an Earnings ESP of +11.35% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cadence Design Systems CDNS has an Earnings ESP of +0.79% and a Zacks Rank #2.

Universal Display OLED has an Earnings ESP of +20.52% and a Zacks Rank #2.

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