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

To: patroller who wrote (5005)	3/13/1999 7:20:00 PM
From: Jeff Haas	Read Replies (1) \| Respond to of 6317

March 15, 1999, Issue: 1151 Section: Business & Finance Sanmina, Jabil lead major rally of EMS stocks Jennifer L. Baljko Silicon Valley- Stocks of most top-tier electronics manufacturing services (EMS) companies rose sharply last week amid renewed confidence in the rapidly growing sector. The index of top-tier EMS companies climbed 130 points (15.7%) from March 3 to 10, closing Wednesday at 960.72. Leading the charge was Sanmina Corp., which rose more than $13 (27.27%) in the five-day period, closing Wednesday at $63.88. Another strong performer was Jabil Circuit Inc., which rose $5.63 (18.29%), to $36.78. Jabil's comeback, which was attributed to a successful secondary stock offering last week following an impressive "roadshow," came just a few weeks after 3Com Corp., a major customer, had indicated weak demand going forward. "3Com's preannouncement had an overblown impact on the industry," said analyst Herve Francois of Credit Suisse First Boston, New York. "Jabil wanted to show investors that just because 3Com sneezes, it won't catch a cold." Along with the 3Com warning, questions have been raised in recent weeks about the health of the PC industry. With Dell Computer Corp. and Hewlett-Packard Co. missing EPS marks for their most recent quarters, and Compaq Computer Corp.'s precautionary statements about the current period, investors' knee-jerk reactions trickled down to the EMS sector, analysts said. In fact, stocks for both product and service contractors were down an average of 24% in early March from their 52-week highs, said J. Keith Dunne, an analyst at BancBoston Robertson Stephens, San Francisco. He added that investors have also been busy taking profits in the wake of last year's strong fourth quarter. "The stocks were down across the board," Dunne said. "There was no distinction between a product company, a service company, a large cap, or a mid-cap. They were all down." Analyst Jim Savage of Thomas Weisel Partners said Jabil's roadshow "laid out a lot of the fundamental trends benefiting top-tier EMS companies," bringing renewed attention to the sector. Analysts noted that contractors are beginning to ramp up programs that were announced in the second half of 1998, adding to the good vibes for a revenue uptick in the next couple of quarters. All six companies in the top-tier EMS index posted gains for the week. Flextronics International Ltd. rose more than $7, to $40.12, following stock upgrades by Lehman Brothers and Needham & Co. Inc. In fact, the biggest "loser" for the week was SCI Systems Inc., whose stock rose less than $1, closing Wednesday at $34.75. SCI's biggest competitor, Solectron Corp., was up more than $6, to $48. This week, Solectron and Jabil are expected to report results in line with or above consensus estimates, analysts said.