Jabil Inc.

Additionally, 5G rollouts are continuing, where the company sees more opportunity in providing engineering content. However, softness in the auto, industrial and energy, and enterprise information technology (IT) spend, which currently represent roughly 30% of revenue, would moderate growth in the near term. Over the longer term, as cloud IT spend continues to lead in the enterprise market, outpacing on-premises IT spending, Jabil could see less demand from hardware customers such as Cisco Systems Inc., Hewlett Packard Enterprise Co., and NetApp Inc. Moreover, the electrification of cars, demand for networking products, continued shift towards smart wearables and smart homes, and cloud infrastructure investments offer opportunities for sustainable revenue growth. The stable outlook reflects our expectation that Jabil will deliver low-

... by COVID-19, we expect Jabil will deliver top-line growth in the low- to mid-single digits over the next two years. Jabil manufactures a diversified portfolio of products in distinct end markets, which supported its top-line growth in recent quarters despite the headwinds imposed by COVID-19 globally. Exposure to faster growing markets (such as 5G and cloud, and healthcare and packaging) increased to 35% of total revenue from 30% in the previous year. Continued demand in areas such as ventilators, temperature sensors, and respiratory equipment will expand revenues in the Diversified Manufacturing Services (DMS) segment over the next year. Because of the pandemic, the world quickly adapted to a comprehensive digital workspace in a couple of months due to global shelter-in-place mandates, which in turn increased demand for cloud infrastructure and created revenue opportunities for Jabil. Additionally, 5G rollouts are continuing, where the...

Full Report