VOO - Jabil Stumbles Into Its Q3 Earnings Report

2024-06-13 23:15:35 ET

Summary

• Jabil stock dropped 16% when a weak Q2 earnings report was released in March. JBL closed at $121 June 13 and is down 23% from its 52-week high of $157.
• CEO Kenneth Wilson was replaced by CFO Mike Dastoor, a 24-year Jabil veteran.
• Despite the weak Q2 and C-suite drama, Jabil reiterated full-year FY2024 guidance, including expectations to generate more than $1 billion in adjusted free cash flow.
• However, the company withdrew FY2025 guidance given poor visibility and continued weakness in multiple end markets.
• Despite its strong free cash flow profile and $2.6 billion in cash at the end of Q2, I reiterate my Hold rating due to a lack of FY2025 visibility.

Jabil ( JBL ) - the supposed " Best Kept Secret On Wall Street" according to yours truly - badly disappointed when Q2 earnings were released back on March 15. As a result, the stock dropped some 16% on the day. And despite a valiant attempt to regroup and rally, the stock closed Thursday at $121 and change (see chart below). That's down 23% from Jabil's "stock buyback" propelled 52-week high of $157. A month later CEO Kenneth Wilson was placed on paid leave "pending completion of an investigation related to corporate policies," according to a company statement. A month after that, the company announced that CFO and interim CEO Mike Dastoor was taking over as CEO . Dastoor is a well respected 24-year Jabil veteran....

For further details see: