Electronic Contract Manufacture (ECM) Sector Message Board

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Strategies & Market Trends : Electronic Contract Manufacture (ECM) Sector

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To: rich evans who wrote (964)	12/15/1997 5:06:00 PM
From: kolo55	Read Replies (2) of 2542

Solectron Earnings are out. I posted the release on the Solectron thread: Message 2971191 The revenues grew 8.8% sequentially from last quarter, but the margin dropped to 5.9% from 6.7% and so the EPS came in at 38 cents versus 40 cents consensus. But I think the EPS shortfall has been pretty widely predicted in recent days. Much of the drop in margins came as Solectron moved into box-build (SCI type of business), which they discussed last quarter, and which has margins of about 3%. The nice sequential gain (versus 6.6% sequential gain last quarter) confirms that the growth in ECM continues unabated (8.8% sequentially for 4 Qs = 40% annualized growth). If the big guns are growing 40%, I think the middle tier players (FLEXF, JBIL, and DIIG) should be able to grow at that rate or better. I purchased more Jabil this morning at 31. More on the Solectron report later. Tomorrow Jabil reports. I expect record revenues and earnings, and that they will beat the consensus estimate. Paul

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