18acastra:
IMHO, SLR and JBL are both overvalued. Questions about your post:
"If you don't like Jabil, you should really hate SLR, as their P/E is 7 points higher, they are growing 5%-10% slower, they missed thier top-line by $75mm of revenue in the Q just reported (Jabil beat by $15mm), and they are relying on acquisitions and the economy to hit their numbers, whereas Jabil has a giant backlog of new programs ramping that already get them above Wall Street guidance, and new
acquisitions represent upside."
Tell me again, why are SLR and JBL different? They both depend on the economy and acquisitions, it seems to me. Also, taken from the earning press release:
biz.yahoo.com
JABIL CIRCUIT, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except for per share data)
(Unaudited)
Three months ended Six months ended
February 28, February 28,
1998 1999 1998 1999
Net revenue $330,688 $493,363 $650,200 $941,304
Cost of revenue 286,628 437,850 564,795 835,216
Gross profit 44,060 55,513 85,405 106,088
Operating expenses:
Selling, general and
administrative 12,858 19,588 23,935 37,906
Research and development 879 989 1,791 2,055
Operating income 30,323 34,936 59,679 66,127
Interest expense, net 1,134 1,670 1,847 3,190
Income before income taxes 29,189 33,266 57,832 62,937
Income taxes 9,050 11,650 18,622 22,035
Net income $ 20,139 $ 21,616 $ 39,210 $ 40,902
Earnings per share:
Basic $ 0.27 $ 0.29 $ 0.53 $ 0.55
Diluted $ 0.26 $ 0.28 $ 0.51 $ 0.52
Common shares used in the
calculations of earnings
per share:
Basic 74,160 74,848 74,100 74,707
Diluted 77,128 78,379 77,240 78,016
Note that the revenues and EPS. The revenues increase almost 50% on a y-to-y comparison, yet EPS went up only slightly. Shares increase only a little. Are there any accounting gimmicks that I am missing?
I see a problem with net margin of their business.
CYC |
