4Q Could Foster Relief For Jabil

Collins Stewart writes "We retain our Buy rating on Jabil Circuit Inc. JBL shares ahead of F4Q10 (Aug) earnings Monday night/conf call Tuesday morning and we could see a relief rally post the release. At $12.70, JBL shares are 21% off the $16 level reached in August and down 30% from March's $18 level. With expectations and valuation low headed into the print, in-line results (which we expect) should remove some uncertainties and could help move the shares up 5-10% higher near-term. The shares are cheap, currently trading at just over 6x our $2.08 FY11 EPS est., drastically below JBL's historical 12x-17x range, more than discounting potential issues and concerns (discussed below) and we would be buyers at these levels into the print. However, until the market begins to favor high beta names, and visibility emerges on HW trends and the economy, additional upside could be a bit of an uphill battle - just look at the action in the shares following the exceptional May qtr." Collins Stewart also maintains its $21 price target for Jabil Circuit Inc, which closed yesterday at $12.70.