Jabil Inc (JBL)

Jabil (JBL) stock declined by 8.36% after the company announced that its chief executive, Kenny Wilson, would be on paid leave pending an investigation related to company policies. The investigation is not related to the company's financial statements or reporting.

• Interim CEO Appointment: Chief Financial Officer Michael Dastoor will serve as interim CEO, effective April 19, following his appointment by the board of directors. Dastoor has been with Jabil since 2000 and has served as CFO since April 2018. Wilson, who has been CEO for almost a year, also joined the company in 2000.
• Financial Outlook: Jabil had previously offered a disappointing outlook for the current quarter in its last reported results. The company's performance in the coming months may be impacted by the leadership change and the ongoing investigation into company policies.

Jabil (JBL) stock dropped by 16.49% due to the company's mixed earnings report and weak guidance in its fiscal Q2 2024 financial report. Here are the key details:

• Earnings Report Highlights: Heading into the earnings report, analysts had forecasted that Jabil would earn $1.66 per share on $6.9 billion in quarterly sales. Jabil beat the earnings number with a "core" profit of $1.68 per share but missed on sales, reporting $6.8 billion.
• GAAP vs. Core Earnings: Jabil reported much stronger earnings according to generally accepted accounting principles (GAAP) than its "core" results suggest. Total earnings for the quarter came to $1.1 billion, or $7.31 per share. However, the bulk of Jabil's profits came from the sale of its mobility division, which accounted for $944 million of the company's profits. After backing out this one-time gain, Jabil arrived at its core profit of $1.68 per share.
• Future Outlook and Guidance: Jabil expects future profits to better resemble the core results just reported. Management guided for $6.2 billion to $6.8 billion in fiscal Q3 revenue and $1.65 to $2.05 in adjusted profits per share (GAAP profits will range from $0.82 to $1.38 per share).
• Investor Considerations: For the full year, Jabil forecasts $28.5 billion in revenue and $8.40 per share in core profits, implying a valuation of 15.2 times earnings. While some analysts forecast Jabil's core earnings will grow only 12% annually over the next five years, the current valuation doesn't necessarily make the stock a "sell" at its current price. However, the recent sell-off is seen as justified given the stock's previous higher valuation.

Shares of Jabil Inc (JBL) dropped by 11.82% from $130.68 to $115.24 in the trading on Wednesday, November 29, 2023. The reason why JBL is down today is due to Jabil Inc.'s recent update to its revenue guidance for the first quarter of fiscal 2024, reflecting the current business conditions.

• Revised Revenue Outlook: Jabil has revised its revenue outlook to provide better clarity amidst a challenging macroeconomic environment. The company now anticipates first-quarter revenues to range between $8.3 billion and $8.4 billion, down from the previous estimate of $8.4-$9 billion. This adjustment is primarily due to weakened demand resulting from short-term inventory corrections in specific end markets.
• Steady Non-GAAP Earnings: Despite the revenue adjustment, non-GAAP earnings are expected to align with the midpoint of the previously guided range of $2.40-$2.80 per share. Jabil foresees market constraints continuing into the fiscal second quarter, leading to projected revenues in the range of $7-$7.6 billion.
• Outlook for Fiscal 2024: Looking ahead to fiscal 2024, Jabil anticipates revenues to be around $31 billion, with a core operating margin ranging from 5.3% to 5.5%, and core earnings of $9.00 per share.