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Jabil Circuit Posts Solid Earnings; Confirms Guidance

Electronics solutions provider Jabil Circuit, Inc. (NYSE: JBL – $27.86) reported fiscal first quarter earnings and revenue that topped analysts’ expectations; it also provided guidance for the second period, in line with Street views. For the quarter ended Nov. 30, Jabil posted adjusted earnings of $0.80 per share, compared with the prior-year period’s $0.69 and two cents above analysts’ views. Revenue was $5.58 billion, vs.$5.1 billion in the same quarter last year also beating Street expectations of $5.49 billion. The Diversified Manufacturing segment posted 12% growth from last year and the Electronics Manufacturing Services group had a 6% gain.

       The St. Petersburg, Florida company expects second quarter earnings per share of $0.50 – $0.74 on revenue of $4.75 billion – $5.05 billion. The Street view is for $0.60 on revenue of $4.74 billion. CEO Mark Mondello commented that the company expects “ten percent revenue growth and nearly 25% core earnings per share growth year-on-year”, which he believes reflects the momentum of the company’s businesses. The company also anticipates the growth to continue in the second half of the fiscal year resulting in earnings per share of about $2.60. Jabil Circuit is returning capital to shareholders via stock buybacks and a small dividend yielding 1.2%. At the recent quotation, I believe the company’s long-term capital gains potential remains positive.

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