JABIL INC (JBL): what the price requires
At today's price, JABIL INC (JBL) is priced for today's economics sustained for ~7.3 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/JBL
Headline
| Field | Value |
|---|---|
| Ticker | JBL |
| Company | JABIL INC |
| Current price | $320.77/sh |
| Composition | Regulated Industries 40% / Intelligent Infrastructure 41% / Connected Living and Digital Commerce 19% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 5.1% |
| Operating margin today | 4.2% |
| Margin expansion implied | +0.9pp |
| Must persist for | 7.3y |
| Multiple paid | 28x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 10.3% cost of capital; growth searched up to the 25.1% self-funding ceiling; each 1pp moves the implied horizon ~1.8 years.
Reconcile: at the x-ray's 9.3% required return this reads ~5.6 years; the models below use their own rates.
How unusual the bet is: elevated
| Reference | Value |
|---|---|
| vs own history | +0.18σ |
| cohort percentile (of 177 peers) | 50 |
| sustained it ~7.3 years at this level | 22% |
| implied end-window share | 0% |
Valuation X-Ray
The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 3.15x | 4 | expensive |
| Earnings | 3.46x | 5 | expensive |
| Relative | 1.24x | 5 | expensive |
| Growth | 0.81x | 3 | justifies |
Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.6%); the inversion above states its own rate.
Per-Model Detail (n=17)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $441.52 | 0.73x | yes | FCF base $1.6B, growth 19% (input: historical growth), terminal g 4.0%, WACC 8.6%, 6yr projection |
| DCF Exit Multiple | Growth | $395.77 | 0.81x | yes | Exit EV/EBITDA: 20.4x / 22.4x / 24.4x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $236.90 | 1.35x | yes | P/E 28.12x (blended: static sector reference 22x + trailing (TTM) 42x), scenarios: 22.9x / 28.1x / 33.4x (bear / base = reference held flat / bull), EV/EBITDA 16x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $81.81 | 3.92x | yes | BV/sh $12.57, ROE (TTM) 60.2%, ke 9.3% |
| Two-Stage Excess Return | Asset | $282.63 | 1.13x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $327.62 | 0.98x | yes | Rev $32.7B, growth 19% (input: historical growth; tapered), Terminal P/S: 0.9x / 1.0x / 1.2x (bear / base = today's held flat / bull, cap 12x) |
| Peter Lynch Fair Value | Relative | $259.35 | 1.24x | yes | EPS $7.41, growth 35% (input: historical EPS growth), PEG=1.21 (Fair) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $92.79 | 3.46x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $1.58B × (1−26%) / WACC 8.6% → EPV (no growth) |
| Residual Income | Asset | $134.35 | 2.39x | yes | BV $12.57 + 5yr PV of (ROE (TTM) 60.2% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $45.78 | 7.01x | yes | √(22.5 × EPS $7.41 × BVPS $12.57) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $220.44 | 1.46x | yes | EBITDA $1.66B × sector EV/EBITDA 16.0x |
| FCF Yield | Earnings | $100.33 | 3.20x | yes | FCF $1275.0M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $86.98 | 3.69x | yes | SBC-adj FCF $1.14B (FCF $1.27B − SBC $0.13B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $239.10 | 1.34x | yes | EPS $7.41 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $9.23 | 34.75x | yes | BV $12.57 × (ROIC 6.3% / WACC 8.6%) (excluded from median) |
| P/Sales Sector | Relative | $1527.92 | 0.21x | yes | Revenue $32.67B × sector P/S 5.0x |
| PEG Fair Value | Relative | $277.88 | 1.15x | yes | EPS $7.41 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $80.11 | 4.00x | yes | EPS $7.41 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $2.4b |
| Net debt / NOPAT (after-tax) | 2.50x |
| Net debt / operating income (pre-tax) | 1.85x |
| Share count CAGR (buyback) | -7.6% |
| Burning cash | no |
Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.
Bullet Takeaways
- Jabil is a global manufacturing-services company that builds products for other brands across three segments, Regulated Industries, Intelligent Infrastructure, and Connected Living and Digital Commerce, and it has become a major beneficiary of the AI data-center build-out.
- At $371.80 only the forward-growth method reaches the price; the asset, earnings-power, and peer-multiple methods all say richly valued, so the price is a bet on durable compounding the static frames cannot capture.
- Jabil raised fiscal 2026 guidance to roughly $34 billion in revenue and $12.25 core EPS as its Intelligent Infrastructure segment grew 52% year over year and AI-related revenue climbed toward $13.1 billion.
Bull Case
Begin with the bear's strongest objection, because confronting it is how the bull case earns its keep: contract manufacturing is a low-margin, commodity business, and Jabil's roughly 4% operating margin seems to prove it. An electronics manufacturing services firm builds to other companies' designs, competes on price and execution, and historically traded at low single-digit multiples for good reason. So why pay over $370 for a 4%-margin manufacturer? The answer is that the data has shifted under the old framing, and the shift is structural rather than cyclical.
The pivot is in the mix. Jabil's Intelligent Infrastructure segment, which serves cloud, data-center, and networking customers, grew 52% year over year and now accounts for roughly half of revenue, and the company's AI-related revenue is guided toward $13.1 billion, up 46%. This is no longer the assembler of low-value consumer electronics it once was; it is increasingly an outsourced builder of the high-complexity infrastructure that hyperscalers need and cannot make fast enough themselves. The 10-K acknowledges customer concentration but frames the diversification deliberately, noting it continues to "diversify our customer base across industries and geographies to strength"en the business, with the Regulated Industries segment adding stickier healthcare and automotive content alongside the infrastructure boom. As the mix tilts toward complex, design-intensive AI hardware, the margin and the durability of the franchise both rise.
The financial execution backs the re-rating. Fiscal second-quarter revenue reached $8.3 billion, up from $6.7 billion a year earlier, and core EPS of $2.69 beat the $2.51 consensus, prompting management to lift full-year guidance to about $34 billion in revenue and $12.25 core EPS. Capital allocation is unusually shareholder-friendly for the sector: Jabil has been retiring its shares at nearly 8% a year, one of the most aggressive buyback programs among large industrials, which means the rising profits are landing on a rapidly shrinking share count. The bull case is that the bear's commodity-manufacturer framing is being overtaken by a genuine shift toward AI-infrastructure content, and the forward-growth method that reaches the price is the one correctly pricing that transition.
Bear Case
The structural weakness to weigh in Jabil is on the balance sheet and the capital structure, because the very buyback that flatters per-share earnings is consuming the cushion a thin-margin manufacturer needs. Jabil carries about $2.4 billion of net debt against $4.2 billion of gross debt, and the filings note interest expense is not separately broken out cleanly enough to compute a clean coverage ratio. More telling, the company has been shrinking its share count nearly 8% a year, funding repurchases that, in a low-margin business, draw down financial flexibility. Buying back stock at over $370 a share, after the price has roughly doubled on AI enthusiasm, is the kind of capital allocation that looks brilliant if the boom continues and reckless if it does not, leaving less balance-sheet room precisely when a manufacturer most needs it.
The operating model amplifies that fragility. Electronics manufacturing services runs on razor-thin margins, around 4% here, which means a small swing in volumes, pricing, or component costs has an outsized effect on profit. The business is also working-capital intensive: ramping AI-infrastructure production requires carrying inventory and receivables for large, concentrated customers, and the 10-K is explicit that a single large customer relationship can represent "a major portion of our net revenue." Customer concentration in a low-margin, capital-hungry business is a structural vulnerability: if a hyperscaler insources, switches vendors, or simply slows orders, Jabil is left with stranded capacity and working capital on a balance sheet that the buyback has already leaned out.
The valuation leaves no room for any of this to go wrong. At $371.80 the asset, earnings-power, and peer-multiple methods all land far below the price; the zero-growth earnings-power value is near $92, the residual-income method near $134, and EV/EBITDA near $220. Only the forward-growth methods reach the price, and they do so by assuming the AI-infrastructure boom continues to lift both volume and margin for years. The framework reads the name as elevated, with a fade signal tripped, because the price extrapolates a step-change in a historically cyclical, commodity-adjacent business. The bear case is the combination: a thin-margin, customer-concentrated manufacturer, with leverage and a heavy buyback that have reduced its safety margin, priced for a durable AI super-cycle that a single demand wobble could interrupt.
Valuation
Jabil is an elevated case where only the forward-growth family reaches the price. At $371.80 the static methods cluster well below: the zero-growth earnings-power value is near $92, the simple excess-return method near $82, residual income near $134, relative valuation near $269, and EV/EBITDA near $220. The perpetual-growth and exit-multiple DCF methods reach roughly $430 to $442, and the discounted-future-market-cap method near $380, essentially today's price. The blended figure across all methods is near $276, which says the price embeds a meaningful premium for growth and margin durability that the present economics do not yet justify.
The valuation hinges on the difference between what Jabil earns today and what the mix shift implies it will earn. The current operating margin is around 4%, typical for electronics manufacturing services, but the AI-infrastructure tilt is lifting both the growth rate (revenue up sharply, with the Intelligent Infrastructure segment growing 52%) and, the bulls argue, the through-cycle margin. The inversion treats the price as a bet on durable compounding sustained over a long runway, with an implied duration near nine years. That is coherent if AI-infrastructure demand is a multi-year secular wave and Jabil holds its position in it, but it is an extrapolation from a business whose history is cyclical and margin-thin.
The balance sheet is moderate but worth watching given the model. Net debt of about $2.4 billion runs near 1.7 times operating income, which is reasonable, but the aggressive buyback (share count down nearly 8% a year) and the working-capital intensity of ramping AI production mean financial flexibility is being spent.
Catalysts
Jabil's fiscal second quarter, reported in March 2026, beat expectations and drove a guidance raise on AI data-center strength. Net revenue reached $8.282 billion, up from $6.728 billion a year earlier, and core EPS of $2.69 topped the $2.51 consensus. The Intelligent Infrastructure segment, serving cloud, data-center, and networking customers, accounted for 49% of revenue and grew 52% year over year. Management raised fiscal 2026 guidance to approximately $34 billion in revenue (up from $32.4 billion) and $12.25 core EPS, and lifted its AI-related revenue outlook to $13.1 billion, up 46%.
The catalysts from here are dominated by the AI-infrastructure cycle. The key things to watch are whether the Intelligent Infrastructure segment sustains its growth rate and whether AI-related revenue tracks toward the raised $13.1 billion target, the trajectory of segment margins as the mix shifts toward more complex, design-intensive work, and any change in customer concentration or order patterns from the large cloud and data-center buyers. Continued aggressive share repurchases are a per-share tailwind as long as cash flow supports them. Because the price already reflects a successful AI transition, the most important catalyst is evidence that the infrastructure demand and the margin improvement are durable; the risk catalyst is any sign of hyperscaler order moderation or insourcing that would test the elevated valuation.
Peer Cohorts (Per Segment, With Filing Citations)
Regulated Industries / Connected Living and Digital Commerce (reported)
- CLS (CELESTICA INC.)
- (no filing in the citation store)
- SANM (Sanmina Corporation)
- (no filing in the citation store)
- FLEX (FLEX LTD.)
- (no filing in the citation store)
- PLXS (PLEXUS CORP.)
- (no filing in the citation store)
- BHE (BENCHMARK ELECTRONICS, INC.)
- (no filing in the citation store)
- TTMI (TTM TECHNOLOGIES INC)
- (no filing in the citation store)
Intelligent infrastructure (reported)
- CLS (CELESTICA INC.)
- (no filing in the citation store)
- SANM (Sanmina Corporation)
- (no filing in the citation store)
- FLEX (FLEX LTD.)
- (no filing in the citation store)
- PLXS (PLEXUS CORP.)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
Jabil Q2 FY2026 earnings, MLQ.ai / Yahoo Finance, March 2026 · Jabil Q2 FY2026 earnings, MLQ.ai, March 2026 · Jabil Q2 FY2026 earnings, Yahoo Finance / Alpha Spread, March 2026 · Jabil Q2 FY2026 earnings, InsiderFinance / Alpha Spread, March 2026