Jabil Benefits from AI Data Center Boom with Strong Earnings Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy JBL?
Source: Fool
- Strong Earnings Report: Jabil's fiscal Q2 revenue surged 23% year-over-year to $8.3 billion, with its intelligent infrastructure business accounting for half of this revenue, indicating robust market demand and growth potential.
- Improved Profitability: The company's adjusted earnings per share rose 39% year-over-year to $2.69, surpassing analyst expectations, reflecting effective product mix improvements and cost control measures.
- Optimistic Outlook: Jabil has raised its fiscal 2026 revenue guidance to $34 billion and anticipates a 46% increase in AI revenue to $13.1 billion, positioning the company favorably in the rapidly growing AI market.
- Capacity Utilization Improvement: Jabil's capacity utilization rate currently stands at 75%, with expectations to increase it to 80%, which will help expand its adjusted operating margin to over 6%, further enhancing the company's profitability and market competitiveness.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy JBL?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on JBL
Wall Street analysts forecast JBL stock price to fall
6 Analyst Rating
5 Buy
1 Hold
0 Sell
Strong Buy
Current: 271.960
Low
244.00
Averages
265.00
High
283.00
Current: 271.960
Low
244.00
Averages
265.00
High
283.00
About JBL
Jabil Inc. provides comprehensive engineering, manufacturing, and supply chain solutions. The Company provides comprehensive electronics design, production, and product management services to companies in various industries and end markets. The Company’s Regulated Industries segment is focused on regulated markets and includes revenues from customers primarily in the automotive and transportation, healthcare and packaging, and renewable energy infrastructure industries. Its Intelligent Infrastructure segment is focused on the modern digital ecosystem including artificial intelligence (AI) infrastructure and includes revenues from customers primarily in the capital equipment, cloud and data center infrastructure, and networking and communications industries. Its Connected Living and Digital Commerce segment is focused on digitalization and automation, including warehouse automation and robotics. The Company is also engaged in drug development and manufacturing solutions.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Jabil Sees Significant Growth in AI Business
- Strong Revenue Growth: Jabil's fiscal Q2 revenue surged 23% year-over-year to $8.3 billion, primarily driven by its intelligent infrastructure business, which constitutes half of its total revenue, highlighting robust demand in the AI data center market.
- Improved Profitability: The company's adjusted earnings per share rose 39% year-over-year to $2.69, exceeding analyst expectations, while the operating margin for the intelligent infrastructure segment increased by 40 basis points, indicating successful cost management and product mix optimization.
- Upgraded Full-Year Guidance: Jabil raised its fiscal 2026 revenue forecast to $34 billion and increased its earnings per share estimate to $12.25, up from $11.55, reflecting the company's optimistic outlook on its AI business growth.
- Customer Expansion Potential: Jabil is in talks with a third hyperscaler customer for data center solutions, expecting to finalize the deal in the coming weeks, which could significantly contribute to its revenue in fiscal 2027, further solidifying its position in the AI market.
See More
Jabil Inc. Options Trading Analysis
- Put Option Appeal: Selling the put option at a $260.00 strike price with a current bid of $13.60 allows investors to commit to buying shares at $260.00 while collecting a premium, effectively lowering their cost basis to $246.40, making it attractive for those interested in JBL stock.
- Potential Return Analysis: Should the put option expire worthless, it would yield a 5.23% return on cash commitment, equating to an annualized return of 38.18%, highlighting the profit potential of this strategy.
- Call Option Opportunity: Selling the call option at a $270.00 strike price with a current bid of $16.20, after purchasing JBL shares at $267.51, could yield a total return of 6.99% if the stock is called away at expiration.
- Risk Assessment: Current data indicates a 61% chance of the $260.00 put option expiring worthless and a 47% chance for the $270.00 call option, necessitating investor awareness of these risks to optimize investment decisions.
See More
Salesforce and Chevron Options Trading Volume Surge
- Salesforce Options Volume: Salesforce Inc saw options trading volume of 80,242 contracts, equating to approximately 8 million shares, which represents 60.3% of its average daily trading volume over the past month, indicating strong market interest in its future performance.
- High-Frequency Trading Insight: Within Salesforce, the $180 strike put option has seen 34,250 contracts traded today, representing about 3.4 million shares, reflecting investor expectations of potential price declines that could impact stock volatility.
- Chevron Options Activity: Chevron Corporation's options trading volume reached 75,380 contracts, approximately 7.5 million shares, accounting for 49.6% of its average daily trading volume over the past month, showcasing active trading interest in its stock.
- Put Option Trading: For Chevron, the $195 strike put option has traded 5,496 contracts today, representing around 549,600 shares, indicating a cautious sentiment among investors regarding its future performance, which may influence its stock price trajectory.
See More
Jabil Benefits from AI Data Center Boom with Strong Earnings Growth
- Strong Earnings Report: Jabil's fiscal Q2 revenue surged 23% year-over-year to $8.3 billion, with its intelligent infrastructure business accounting for half of this revenue, indicating robust market demand and growth potential.
- Improved Profitability: The company's adjusted earnings per share rose 39% year-over-year to $2.69, surpassing analyst expectations, reflecting effective product mix improvements and cost control measures.
- Optimistic Outlook: Jabil has raised its fiscal 2026 revenue guidance to $34 billion and anticipates a 46% increase in AI revenue to $13.1 billion, positioning the company favorably in the rapidly growing AI market.
- Capacity Utilization Improvement: Jabil's capacity utilization rate currently stands at 75%, with expectations to increase it to 80%, which will help expand its adjusted operating margin to over 6%, further enhancing the company's profitability and market competitiveness.
See More
Apple Expands U.S. Manufacturing Partnerships with New Suppliers
- Increased Manufacturing Partnerships: Apple has announced the addition of new partners including Qnity Electronics, Cirrus Logic, Bosch, and TDK to its American Manufacturing Program, planning to invest $400 million by 2030, which enhances its supply chain localization and strengthens U.S. manufacturing competitiveness.
- Strategic Investment Commitment: Apple's commitment to invest $500 billion in 2025, with an additional $100 billion, underscores its long-term dedication to the U.S. market, aiming to mitigate supply chain risks and enhance brand image through localized production.
- Critical Component Supply: Qnity's involvement highlights its importance in the semiconductor supply chain, as Apple relies on its specialized chemicals and materials, ensuring a stronger partnership with TSMC and enhancing Apple's competitive edge in chip manufacturing.
- Enhanced Market Competitiveness: Qnity's stock remains cheaper compared to its main rival Entegris, trading at less than 32 times earnings estimates, indicating strong future earnings growth potential, with Apple's backing further solidifying its market position.
See More
Jabil Inc. Options Trading Analysis
- Put Option Appeal: Selling a put option at a $270.00 strike price with a current bid of $12.10 allows investors to commit to purchasing stock at $270.00 while collecting a premium, effectively lowering their cost basis to $257.90, which represents an attractive approximately 2% discount compared to the current price of $274.84, appealing to those interested in JBL shares.
- Yield Potential Analysis: Should the put option expire worthless, it would yield a 4.48% return on the cash commitment, equating to an annualized yield of 38.04%, referred to as YieldBoost, highlighting the strategy's potential attractiveness.
- Call Option Returns: Selling a call option at a $280.00 strike price with a current bid of $12.70, if an investor buys JBL shares at $274.84 and sells this call, could yield a total return of 6.50% if the stock is called away at expiration, showcasing the potential profitability of this strategy.
- Risk Assessment: Current analytics indicate a 58% chance of the put option expiring worthless and a 52% chance for the call option, suggesting that investors must carefully evaluate the balance of risk and reward when selecting their options strategies.
See More
Jabil Sees Significant Growth in AI Business
- Strong Revenue Growth: Jabil's fiscal Q2 revenue surged 23% year-over-year to $8.3 billion, primarily driven by its intelligent infrastructure business, which constitutes half of its total revenue, highlighting robust demand in the AI data center market.
- Improved Profitability: The company's adjusted earnings per share rose 39% year-over-year to $2.69, exceeding analyst expectations, while the operating margin for the intelligent infrastructure segment increased by 40 basis points, indicating successful cost management and product mix optimization.
- Upgraded Full-Year Guidance: Jabil raised its fiscal 2026 revenue forecast to $34 billion and increased its earnings per share estimate to $12.25, up from $11.55, reflecting the company's optimistic outlook on its AI business growth.
- Customer Expansion Potential: Jabil is in talks with a third hyperscaler customer for data center solutions, expecting to finalize the deal in the coming weeks, which could significantly contribute to its revenue in fiscal 2027, further solidifying its position in the AI market.
See More
Jabil Inc. Options Trading Analysis
- Put Option Appeal: Selling the put option at a $260.00 strike price with a current bid of $13.60 allows investors to commit to buying shares at $260.00 while collecting a premium, effectively lowering their cost basis to $246.40, making it attractive for those interested in JBL stock.
- Potential Return Analysis: Should the put option expire worthless, it would yield a 5.23% return on cash commitment, equating to an annualized return of 38.18%, highlighting the profit potential of this strategy.
- Call Option Opportunity: Selling the call option at a $270.00 strike price with a current bid of $16.20, after purchasing JBL shares at $267.51, could yield a total return of 6.99% if the stock is called away at expiration.
- Risk Assessment: Current data indicates a 61% chance of the $260.00 put option expiring worthless and a 47% chance for the $270.00 call option, necessitating investor awareness of these risks to optimize investment decisions.
See More
Salesforce and Chevron Options Trading Volume Surge
- Salesforce Options Volume: Salesforce Inc saw options trading volume of 80,242 contracts, equating to approximately 8 million shares, which represents 60.3% of its average daily trading volume over the past month, indicating strong market interest in its future performance.
- High-Frequency Trading Insight: Within Salesforce, the $180 strike put option has seen 34,250 contracts traded today, representing about 3.4 million shares, reflecting investor expectations of potential price declines that could impact stock volatility.
- Chevron Options Activity: Chevron Corporation's options trading volume reached 75,380 contracts, approximately 7.5 million shares, accounting for 49.6% of its average daily trading volume over the past month, showcasing active trading interest in its stock.
- Put Option Trading: For Chevron, the $195 strike put option has traded 5,496 contracts today, representing around 549,600 shares, indicating a cautious sentiment among investors regarding its future performance, which may influence its stock price trajectory.
See More
Jabil Benefits from AI Data Center Boom with Strong Earnings Growth
- Strong Earnings Report: Jabil's fiscal Q2 revenue surged 23% year-over-year to $8.3 billion, with its intelligent infrastructure business accounting for half of this revenue, indicating robust market demand and growth potential.
- Improved Profitability: The company's adjusted earnings per share rose 39% year-over-year to $2.69, surpassing analyst expectations, reflecting effective product mix improvements and cost control measures.
- Optimistic Outlook: Jabil has raised its fiscal 2026 revenue guidance to $34 billion and anticipates a 46% increase in AI revenue to $13.1 billion, positioning the company favorably in the rapidly growing AI market.
- Capacity Utilization Improvement: Jabil's capacity utilization rate currently stands at 75%, with expectations to increase it to 80%, which will help expand its adjusted operating margin to over 6%, further enhancing the company's profitability and market competitiveness.
See More
Apple Expands U.S. Manufacturing Partnerships with New Suppliers
- Increased Manufacturing Partnerships: Apple has announced the addition of new partners including Qnity Electronics, Cirrus Logic, Bosch, and TDK to its American Manufacturing Program, planning to invest $400 million by 2030, which enhances its supply chain localization and strengthens U.S. manufacturing competitiveness.
- Strategic Investment Commitment: Apple's commitment to invest $500 billion in 2025, with an additional $100 billion, underscores its long-term dedication to the U.S. market, aiming to mitigate supply chain risks and enhance brand image through localized production.
- Critical Component Supply: Qnity's involvement highlights its importance in the semiconductor supply chain, as Apple relies on its specialized chemicals and materials, ensuring a stronger partnership with TSMC and enhancing Apple's competitive edge in chip manufacturing.
- Enhanced Market Competitiveness: Qnity's stock remains cheaper compared to its main rival Entegris, trading at less than 32 times earnings estimates, indicating strong future earnings growth potential, with Apple's backing further solidifying its market position.
See More
Jabil Inc. Options Trading Analysis
- Put Option Appeal: Selling a put option at a $270.00 strike price with a current bid of $12.10 allows investors to commit to purchasing stock at $270.00 while collecting a premium, effectively lowering their cost basis to $257.90, which represents an attractive approximately 2% discount compared to the current price of $274.84, appealing to those interested in JBL shares.
- Yield Potential Analysis: Should the put option expire worthless, it would yield a 4.48% return on the cash commitment, equating to an annualized yield of 38.04%, referred to as YieldBoost, highlighting the strategy's potential attractiveness.
- Call Option Returns: Selling a call option at a $280.00 strike price with a current bid of $12.70, if an investor buys JBL shares at $274.84 and sells this call, could yield a total return of 6.50% if the stock is called away at expiration, showcasing the potential profitability of this strategy.
- Risk Assessment: Current analytics indicate a 58% chance of the put option expiring worthless and a 52% chance for the call option, suggesting that investors must carefully evaluate the balance of risk and reward when selecting their options strategies.
See More
