Simply Wall St
4 min read
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If you are wondering whether Jabil’s share price still offers value after a strong run, or if you might be late to the story, this article walks through what the current market price could be indicating.
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The stock closed at US$221.81, with a 7 day return of a 2.7% decline, a 30 day return of a 2.8% decline, a year to date return of a 7.7% decline, a 1 year return of 44.3%, a 3 year return of 193.8% and a 5 year return that is almost 4 times higher.
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Recent coverage has focused on Jabil’s positioning within the broader technology and manufacturing supply chain, as well as how investors are reacting to its role as a key partner for large electronics brands. This context helps explain why expectations and risk perceptions around the stock have been shifting, even over relatively short periods.
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In our framework, Jabil currently scores 3 out of 6 on undervaluation checks. You can see this in detail through its valuation score. Next, we look at how different valuation methods line up, before finishing with a more complete way to think about what the market is pricing in.
The Discounted Cash Flow model estimates what a company might be worth by projecting its future cash flows and discounting them back to today using a required return. It is essentially asking what those future dollars are worth in your hands right now.
For Jabil, the latest twelve month free cash flow is about $953.8 million. Using a 2 stage Free Cash Flow to Equity model, analysts have provided explicit forecasts up to 2028, with Simply Wall St extrapolating further out. By 2035, the projection used in the model is free cash flow of roughly $2.95b, expressed in today’s dollars through discounting each year’s estimate.
When all these projected cash flows are added together, the DCF model arrives at an estimated intrinsic value of about $349.58 per share. Compared with the recent share price of US$221.81, this implies the stock is trading at a 36.5% discount to that intrinsic estimate. This indicates a material gap between the model’s value and the market price.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Jabil is undervalued by 36.5%. Track this in your watchlist or portfolio, or discover 881 more undervalued stocks based on cash flows.
For a profitable company like Jabil, the P/E ratio is a straightforward way to relate what you pay per share to the earnings that each share generates. It captures how the market is weighing current profits against expectations for future earnings and the risks around them.