Jabil’s stock (JBL) increases by 15.2% following latest earnings report: What comes next?

have experienced a significant increase of 15.2%. This rise is commendable, especially when compared to the S&P 500 index.

However, the lingering question remains – will this upward trend continue? Before delving into the opinions of analysts, let’s take a closer look at the factors driving this surge by revisiting their recent earnings report for the first quarter of fiscal 2025.

During this period, Jabil outperformed earnings estimates, signaling positive growth. Despite this, their revenue saw a decline from the previous year, primarily due to challenges in certain sectors. The company reported a net income of $100 million, a noticeable decrease from $194 million in the prior year. On a more positive note, their non-GAAP earnings exceeded expectations, amounting to $228 million.

In terms of sales, Jabil generated $6.99 billion, a reduction from $8.4 billion in the corresponding period last year. Nevertheless, this figure surpassed analysts’ forecasts. The Regulated Industries sector constituted a significant portion of their revenue; however, it faced a decline attributed to issues within the Auto & Transportation segment.

Conversely, the Intelligent Infrastructure division displayed strong performance, contributing 36% of total revenues and exhibiting a 5% growth year-over-year. The Connected Living & Digital Commerce sector proved to be a standout performer with an impressive 46% increase in sales.

Analyzing their cash flow, Jabil reported $312 million in operating cash flow, slightly lower than the $448 million recorded in the previous year. The company maintains a robust cash position, holding over $2 billion in cash and equivalents.

Looking ahead to the next quarter, Jabil anticipates revenues ranging between $6.1 billion and $6.7 billion, with projected non-GAAP earnings falling between $1.60 and $2.00 per share. For the entire fiscal year, their revenue target is set at approximately $27.3 billion.

Despite positive results, recent estimates indicate a downward trend, resulting in Jabil holding a Zacks Rank of #3, indicating a hold recommendation. While the company has experienced a commendable performance, the sustainability of this growth trajectory in the upcoming months remains uncertain.