What happened
Shares of Jabil (NYSE: JBL) were up 19% as of 2:27 p.m. ET Thursday after the manufacturing giant announced better-than-expected quarterly earnings and encouraging forward-earnings guidance.
So what
For its fiscal fourth quarter ended Aug. 31, 2023, Jabil's revenue declined 6.3% year over year to $8.458 billion, translating to adjusted (non-GAAP) earnings of $2.45 per share. Analysts, on average, were anticipating lower earnings of $2.32 per share but on slightly higher revenue of $8.54 billion.
Within Jabil's top line, diversified manufacturing services (DMS) segment revenue was roughly consistent with the same year-ago period, while electronics manufacturing services (EMS) sales declined 13%.
Jabil's board of directors also significantly boosted their current share-repurchase authorization, which had roughly $776 million remaining at the end of the quarter, to allow repurchase of up to $2.5 billion in common stock.
Now what
For the current first quarter of fiscal-year 2024, Jabil expects revenue to range from $8.4 billion to $9.0 billion, which should translate to adjusted earnings per share of $2.40 to $2.80. Here again, most analysts were modeling lower fiscal Q1 earnings of $2.32 per share on revenue of $8.54 billion (below the $8.7 billion midpoint of Jabil's guidance range).
In light of that strong outlook, it's clear the forward-looking market was willing to ignore Jabil's top-line weakness to end its latest fiscal year. Shares are simply responding in kind today.
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Steve Symington has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
