Jabil Inc (JBL)

Bear Case

Based on the comprehensive research synthesis, here's the Bear Case for JBL's upcoming Q3 FY2025 earnings report:

Probability of Bear Case: 45%

Supporting Factors for ER:

• Stock is technically overbought with RSI at 73.09, trading near 52-week highs ($180.16)
• Consistent insider selling from executives (CEO, CFO, Chairman) in recent months
• Average analyst price targets ($169-183) suggest limited upside or potential downside from current levels
• Revenue continues to show YoY declines despite strategic shifts
• High debt-to-equity ratio (242.49%) makes company vulnerable in rising rate environment
• Recent technical indicators show "Neutral" to "Sell" signals from oscillators
• Market expectations are high with consensus EPS of $2.32 (+22.9% YoY), creating risk of disappointment

Risks to Thesis:

• Strong track record of beating EPS estimates (last 4 quarters)
• Robust free cash flow generation ($1B+ annually)
• Strategic shift to higher-margin businesses improving profitability metrics
• Growing AI-related revenue ($7.5B projected for FY25)
• Active $1B share repurchase program providing price support
• Historical tendency for positive post-earnings moves (7 of last 12 reports)

ER Play Trade Strategy: