MidnightTrader Earnings Play: Jabil Circuit

Jabil Circuit (JBL | Quote | Chart | News | PowerRating) is lower ahead of its Q3 results due after the bell tonight. Analysts polled by Thomson Financial on average expect the company to post profits of $0.20 per share on revenue of $3.08 billion.

JBL is one to watch in extended-hour action as the stock, over the last four years, continues to show a tendency to widen its next-day share response after an evening earnings release. The same holds true for the near term. The issue has widened in the last six consecutive quarters.

Looking deeper into the performance data, the stock performs well on both the long and short sides of the trade between its earnings-driven after-hours move and following day's regular session.

On the short side, JBL has seen negative post-bell earnings-driven trade in eight events we've tracked, and in six of those quarters the stock has moved deeper into the red in the following day's regular session.

On the long side, JBL has recorded a positive after-hours earnings-driven move in four events, and it has seen a more robust upside move in the following bell-to-bell trade in three of those events.

On March 25, 2008, JBL declined 12.8% in after-hours trade after beating on Q2 but offering guidance below expectations. It was crushed for more aggressive declines the next day, losing 18.3% by the close on March 26.

On Dec. 20, 2007, the stock dropped 10.4% during evening hours after JBL reported guidance below the Street's view. The loss swelled to 21.6% the next day.

On Sept. 27, 2007, JBL eased 1.1% in night trade despite beating Q4 estimates and forecasting Q1 to be about in line with expectations. Shares fell even more the next day, closing the regular session down 6.7%.

On June 21, 2007, the stock gained 8.2% in the evening hours after earnings fell from a year earlier but beat the Street's view. The gain expanded to 9.8% the next day.

On March 22, 2007, the stock fell 5.7% after the company beat with sales but said it sees restructuring costs at high end of guidance. The loss widened to 10.7% the next day.

Brooks McFeely is widely regarded as the leading expert on extended-hours trading. He is a Managing Partner for Brochet Capital Partners, LP and the founder of Midnight Trader, Inc. (www.midnighttrader.com), the leading provider of pre-market and after-hours trading analysis and news to retail and institutional investors.