Apple is their largest customer. Jabil is a contract manufacturer for the electronics industry. Generally speaking, when they do poorly, the electronics industry is sucking wind.
Hence, Goldman slapped a sell rating on JBL today, citing 7 out of Jabil’s top 10 customers mired with a weakening outlook.
Their Apple exposure has become an albatross to them.
If you enjoy the content at iBankCoin, please follow us on Twitter“We see earnings pressure from both limited top-line growth and increased overhead costs for Jabil. For revenue, Street assumptions have been reduced for 7 of Jabil’s top 10 customers since the last EPS report,” Goldman Sachs’ Mark Delaney wrote in a note to clients Tuesday.
“Our reduced estimates are consistent with the fact that Goldman Sachs analysts have lowered estimates for several of Jabil’s key customers since Jabil’s last report (e.g. Apple, NetApp and Ericsson). … High Apple exposure is a key part of the reason that Jabil has had to significantly reduce its guidance in two of the last three fiscal years.”
