11:44 AM EDT, 09/16/2024 (MT Newswires) -- Jabil's ( JBL ) key end markets including the electric vehicles and renewable energy industries are facing persistent headwinds that cloud prospects for a robust recovery for the electronics components maker, UBS said in a report Monday.

The investment firm lowered its fiscal 2025 and 2026 earnings and revenue estimates for the company, taking into account a more modest demand backdrop and the removal of about $800 million in revenue in fiscal 2025 that Jabil ( JBL ) is no longer targeting amid margin and returns considerations.

Fiscal Q4 estimates have also been cut, with UBS now expecting revenue of $6.55 billion, down from its previous forecast of $6.85 billion, while earnings per share are now projected at $2.13 versus its previous estimate of $2.26.

"Our checks point to prolonged softness heading into FY25 in key Jabil ( JBL ) end-markets. Therefore, unless we see evidence of a broad-based recovery in the near term, FY25 is likely to be another transition year in our view," the firm said in its report. "Our negative revisions pressure margins and EPS estimates."

For fiscal 2025, UBS now sees EPS of $8.38 on revenue of $26.96 billion, down from its previous estimates of $9.47 on revenue of $28.5 billion. The firm cut its fiscal 2026 forecasts to $8.99 from $10.32 for EPS, and $27.63 billion from $29.21 billion for revenue.

UBS is maintaining its neutral rating on the stock and a $120 price target.

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