Apple (NASDAQ:AAPL) supplier Jabil (NYSE:JBL) has staged a remarkable turnaround on the stock market over the past few months. The advanced manufacturing-services provider has received a nice shot in the arm, thanks to the huge demand for Apple's iPhone 12 models, as well as an improvement in its financial performance of late.

Jabil looks all set to carry its impressive run into the new year due to favorable business trends. Let's take a closer look at what's working for Jabil and why it isn't too late to buy this tech play as we head into 2021.

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The results are getting better

Jabil recently reported its fiscal 2021 first-quarter results, recording year-over-year revenue growth of 4.4% to $7.8 billion. The bottom line grew 52% over the prior-year period to $1.60 per share, as Jabil's transition to a subscription-based model in the electronics manufacturing services (EMS) segment boosted its margins.

The numbers were comfortably ahead of Wall Street's expectations of $1.27 per share in earnings on revenue of $7 billion. More importantly, Jabil's guidance indicates that it's about to switch into a higher gear. The company expects its revenue to increase 6.5% year over year in the fiscal second quarter to $6.5 billion, according to the midpoint of its guidance range. Its earnings are expected to land between $0.83 and $1.03 per share, which would be a big improvement over the prior-year period's earnings of $0.50 per share.

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What's more, Jabil has bumped up its full-year revenue guidance, and now expects $27.5 billion in revenue in fiscal 2021. The company was originally forecasting $26.5 billion to $27 billion in fiscal 2021 revenue at the beginning of the period. It also anticipates earnings of $4.60 per share for the full year, which is again a significant jump over fiscal 2020's figure of $2.90.

These numbers make it clear that things are looking up for Jabil. A closer look at the trends driving the company's two businesses will tell us why that's the case.

Jabil has solid catalysts

Jabil's diversified manufacturing services (DMS) segment did the heavy lifting for the company last quarter, with year-over-year revenue growth of 13% to $4.2 billion (accounting for 54% of the top line). This segment has been in fine form over the past couple of quarters, thanks to the company's relationship with Apple.

Apple accounts for 22% of Jabil's sales, which is a good thing given the huge demand for the new iPhone 12 models. Jabil makes casings for iPhones, so it stands to win big in 2021, according to the latest supply-chain rumors that are predicting a 30% increase in iPhone production in the first half of 2021. Nikkei Asian reports that Apple is expected to manufacture 96 million iPhone 12 units in the first six months of the new year.

More importantly, the iPhone maker is expected to enjoy impressive sales momentum throughout the year as more consumers upgrade to 5G smartphones. Chinese consultancy firm Cinda Securities estimates that Apple could end up selling between 230 million and 240 million iPhones in 2021. If that's indeed the case, Apple could be heading for a record year in 2021 and exceed the 231 million units that it moved in 2015.

Jabil's reliance on Apple for a nice chunk of its revenue is going to be a tailwind for the DMS business in the new year. The company anticipates a 22% jump in DMS revenue in the current quarter over the prior-year period, and it won't be surprising to see it sustain this impressive momentum for the remainder of the year.

On the other hand, Jabil's EMS business turned in a better-than-anticipated performance last quarter. The segment's revenue was down just 4% year over year to $3.6 billion, as compared to the double-digit percentage decline it was originally anticipating.

Jabil has been changing the model of its EMS cloud business to a consignment-based one, as compared to the earlier model of purchasing and reselling items. Not surprisingly, EMS revenue has dipped, as Jabil is now getting a commission when a sale is made instead of recording the complete value of the sale. The top-line dip is expected to continue in the current quarter, with Jabil forecasting an 8% decline in EMS revenue over the prior-year period.

The good thing is that the transition is positively impacting Jabil's margins. The EMS segment's core margin was up 100 basis points year over year, outpacing the DMS segment's margin increase of 70 basis points. Given that the EMS segment serves fast-growing markets such as cloud computing, automotive, and smart homes, among others, it should be able to deliver growth once the transition is complete.

Growth projections extent into fiscal 2022

This is probably the reason why analyst estimates compiled by Yahoo! Finance point toward an acceleration in Jabil's sales growth in fiscal 2022, along with consistent growth in the company's earnings. All in all, it won't be surprising to see Jabil keep up its hot stock-market rally in 2021 and remain a top growth pick.

That's why investors shouldn't be waiting on the sidelines and should consider buying Jabil stock as it trades at less than 10 times forward earnings. It may not be available at such attractive levels in the future.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.