Corporate Roundup

12/21/2015


In the November quarter, Jabil Circuit's ($24; JBL) per-share profits surged 55% to $0.85 excluding special items, topping the consensus by $0.05. Revenue grew 14% to $5.21 billion, in line with analyst expectations. Management attributed the strong results to improved efficiency and product diversification. Looking ahead to the February quarter, Jabil projected per-share profits of $0.54 to $0.70; the midpoint of $0.62 implied 24% growth and matched the consensus. The midpoint of Jabil's revenue projection is $4.55 billion, up 6% but below the consensus of $4.72 billion. Management also raised its profit target for fiscal 2016 ending August to $2.65 per share, implying 29% growth and exceeding the current consensus of $2.58. Jabil is a Focus List Buy and a Long-Term Buy.


CVS Health ($98; CVS) raised its 2016 per-share-profit guidance to a range with a midpoint near the $5.81 consensus, implying 12% growth. In October, CVS provided a guidance range with a midpoint of $5.78 per share, below the consensus of $6.01 per share at the time. The company also raised its quarterly dividend 21% to $0.425 per share, payable Feb. 2, the 13th consecutive annual increase; each of the past six dividend hikes have exceeded 20%. CVS shares rallied on the news and remain a Buy and a Long-Term Buy.


F5 Networks ($101; FFIV) CEO Manuel Rivelo resigned after just six months on the job due to "personal conduct" unrelated to the company's operations or financial reporting. John McAdam, who retired as F5's CEO in July, will lead the company as it searches for a permanent CEO. The announcement prompted one analyst to speculate that F5 may consider putting itself up for sale next year. F5 is a Buy and a Long-Term Buy.


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