Electronic manufacturing specialist Jabil Circuit (NYSE:JBL) just reported results for the second quarter of fiscal year 2015. Share prices rose more than 3% on the news, as Jabil beat analyst estimates and provided a strong next-quarter forecast.
All of this may be small potatoes for most investors, given Jabil's modest market cap and limited analyst following. But things change when you're talking about a prominent Apple (NASDAQ:AAPL) supplier, especially when the next iPhone appears to have boosted Jabil's numbers.
The company delivered adjusted second-quarter earnings of $0.50 per share on $4.3 billion in total sales. The revenue result was in line with analyst estimates, but the Street would generally have settled for earnings around $0.34 per share.
Overall, the quarter was a breath of fresh air. In the year-ago quarter, Jabil reported earnings of a meager $0.10 per share on just $2.6 billion in sales.
Three months ago, Jabil shares plunged 20% on a downright disappointing report. That miss was the result of soft orders from one large customer. Jabil was mum on exactly which client had caused so much pain, but analysts agreed that no name on the customer list other than Apple could hurt the company's sales that much.
To be fair, Jabil CEO Mark Mondello called it a "temporary" issue at the time. This week, he simply followed up on that promise with a much healthier point of view heading into the important pre-holiday manufacturing season.
In the third quarter, Jabil expects earnings of roughly $0.49 per share on sales of about $4.45 billion. Both figures are above the current Wall Street consensus.
These numbers may point to reasonably generous orders from Apple, as well as healthy demand from other manufacturing services clients. Of course, the manufacturing forecasts of a consumer products designer like Apple shouldn't be taken as gospel for actual retail success this fall, because customers often behave in unpredictable ways.
But it is, at least, a sign of Apple's own management believing in a strong holiday season this year. Apple investors didn't pay much attention to this positive sign on Thursday: The newly minted Dow Jones (DJINDICES:^DJI) member closed 0.6% lower, in line with the major market indexes.