Well, I haven't listened to the CC, but the quarter could have been worse. Cash up nicely to almost half a billion, while inventories and receivables were down somewhat, along with DSOs. The stock is getting hit, and will almost certainly trade in the teens sometime in the next few weeks. If the market gets hit badly (something I expect), it may even go back to the low teens. The ECMs are the ultimate cyclical stocks, though, and a well-run ECM with a good balance sheet should do well when the economy picks up. For now, I am still out of the ECMs except for a few puts I bought in CLS a couple of weeks ago.
Just for the record, here is Main's business outlook for the next year in the earnings release:
<<The Company said the economic environment has deteriorated since its conference call in September and that it expects a slower recovery of its business due to the recessionary economy. The economy, continued telecommunications carrier spending cutbacks and aggressive inventory reductions by customers have resulted in sequentially lower production levels, which will require Jabil to reduce its cost structure by considering plant re-sizing and reductions to the workforce. The Company said it will take a one-time charge in its second fiscal quarter of $10 to $15 million for these changes....
The company expects second quarter production levels of $800 to $850 million with corresponding cash
earnings per share from $0.06 to $0.08.
Jabil expects a resumption of sequential growth in the third and fourth quarters of its fiscal year. The fiscal year revenue
expectation for the company is $3.5 to $4.0 billion with earnings of $0.50 to $0.60 for the full 2002 fiscal year. "We
expect sequential growth to resume in our third and fourth fiscal quarters as new business wins and an improved economic
environment boost our financial performance. We have a solid operating model that will deliver strong financial results as
overall business levels improve in 2002," said Main.>>
If anyone has any comments on the CC, please post. I'll try to listen in tonight.
Sam |
