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Technology Stocks : Jabil Circuit (JBL) -- Ignore unavailable to you. Want to Upgrade?

To: Fenton White who wrote (2337)	12/23/1997 10:29:00 AM
From: ccryder	Read Replies (1) \| Respond to of 6317

How much would HP pay for an JBIL? That question shows a lack of insight on why there is an electronic contract manufacturing industry. The bottom line is that an OEM shop just can't compete with a contract shop. Why is this? For one, a contract shop can have a wide variety of customers from auto electronics, washing machines, to disk drives. As one industry might suffer from excess inventory, work from another industry can be used to soften the blow. An ability to rapidly (measured in hours) change over a line is a necessity to maintain high margins. This is JBIL. A look at another CEM company I own shares in, CMCI, is a counter example where an OEM shop (telephone equipment--low margin) was spun off and left to fend for itself. They are having to expand their engineering staff, quality control, and purchasing to compete with the real CEMs. OK, theroretically an HP shop could do some contract work. But to efficiently produce HP equipment means equipment will be tailored to produce only the type of products HP makes. Making another OEM's printer or writeable CD drive might be possible, but they are competitors. And who would want to contract with HP when they will be at the mercy of ever changing HP needs to adjust their own work? Second, the machinery is another issue. CEMs will have a broad range of machinery available to produce a job. The facility and lines will be chosen to efficiently produce a product. In some instances, the product will be reengineered to be producible more efficiently. An OEM shop will be constrained to use possibly older equipment, because of the high cost of new machinery, and the resulting product will be more expensive than the competitor who has chosen the more efficient CEM. Parts and inventory control? But enough industry fundamentals for now. Suffice to say that Fenton will continue to sow doubt where he can on the fundamentals of the industry and on JBIL at his appropriate time, doing only what other analyists do in other venues, that is making money for themselves and their paying customers. Afterall, he has been good recently at reading the direction of the JBIL market (insiders).

To: Fenton White who wrote (2337)	12/23/1997 7:53:00 PM
From: gs	Respond to of 6317

Merry Crismas Fenton. You say "Price competition is going to increase and component margin will continue to decrease for the next 6 to 9 months". But: 1. How much, I do not see any numbers. 2. Why 6 to 9 months. If you refer to analysts and trust them why six of seven (Yahoo) keep buy rating on the company? 3. How about the production cost, how about prices for materials they use? Are they going to decrease as well? 4. How about whole semiconductor industry, are all companies going out of business because of "margin will continue to decrease for the next 6 to 9 months" 5. 51.76% shares owned by Institutions (from Baseline) and this number keeps growing, are you sure they think the same way. 6. The price of the stock 38 « (already 46.42% down from it is year high 72) and it is selling at 18.16 August 98 earning, and 14.31 next year estimated earnings. It means that any possible margin pressure is already discounted in its price. Without numbers and any proof your post looks like an appeal of the trivial short seller. Regards, Garri. PS. Your CMEL with its -0.02 estimated this year earning looks much better than JBIL. There is a long line of the companies competing to buy them out.

To: Fenton White who wrote (2337)	12/24/1997 12:57:00 PM
From: John Puffer	Read Replies (1) \| Respond to of 6317

* off topic * hi fenton, do you still see tlsp as a good turn around for '98? thanks, john

To: Fenton White who wrote (2337)	1/3/1998 10:41:00 AM
From: Fenton White	Read Replies (1) \| Respond to of 6317

All - We think we will have a nice trading cycle for the next 3 months. I have been buying March 40 calls (yes calls). Anytime the stock pushes we are selling short. We believe the MMs' will try to push the stock to 50-55 by feb. We believe the price will cycle to 30- in March. Why? The financial information that is being feed to you is Clintonspeak. If you want to be long consider a cap. We are buying CMEL and TLSP for positive moves. We are establishing substancial shorts in two other stocks. Last year was unbelievable, thanks to stocks like JBIL. Our outlook for JBIL has not changed since our first posts. As long as it is moving we can all make alot of money. Look at the JBIL customer information and JBIL supplier information. Happy New Year, Fenton