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THE DAY AHEAD: Jabil Circuit on a roll

COMMENTARY --Jabil Circuit doesn't have the same sex appeal as an Intel or a Cisco Systems, but investors looking for another way to cash in on the exploding telecommunications market might want to take a closer look at this booming contract electronics firm.

Jabil Circuit (NYSE: JBL) will report its fourth-quarter earnings after the bell Tuesday with analysts looking for a profit of 24 cents a share.

If past performance is any indicator, Jabil will likely meet the consensus estimate while posting substantial gains in both total sales and gross profit margins.

More impressive, Jabil should eclipse the $1 billion mark in total sales this quarter, firmly cementing its position as a major player on Main Street and on Wall Street.

Driving the sales and profits of Jabil and other contract electronics firms such as Solectron (NYSE: SLR) is not only the surging demand for a variety of networking and telecommunications chips, but the speed that these manufacturers require to get their wares to market.

"There's a huge secular trend to the outsourcing of contract electronics," said Tom Cal, an analyst at Wit SoundView. "Jabil has a very efficient structure and a strong customer profile that has it well positioned for substantial growth in the future."

Jabil's customer list reads like a "Who's Who" in the information technology universe. Dell (Nasdaq: DELL), Gateway (NYSE: GTW), Cisco Systems (Nasdaq: CSCO) and Lucent Technologies (NYSE: LU) are just a handful of Jabil's biggest clients.

Last quarter, Jabil met the Street estimate when it earned $38.2 million, or 21 cents a share, on sales of $965.8 million.

Gross profit in the quarter increased 48 percent to $94.5 million or 9.8 percent of sales compared to $63.8 million or 11 percent of sales in the year-ago period.

The $965.8 million in sales marked a 66 percent improvement from the year-ago quarter, when it earned $24.6 million, or 14 cents a share, on sales of $582.2 million.

At the time, company officials said it plans to continue its expansion plans, including building a new site in Hungary and acquiring more manufacturing capacity in Brazil to keep up with demand.

In August, Donaldson Lufkin Jenrette analyst Mark Hassenberg said that Jabil appeared to be building a $3 billion war chest for acquisitions and was likely to report a 71 percent jump in fourth-quarter earnings.

"We believe there is a very high probability that Jabil will complete a major accretive acquisition before the company reports its fiscal 2000 earnings on September 19," Hassenberg said back in August.

While that deal has yet to materialize, many analysts believe it's just a matter of time before Jabil snaps up one or more companies to build on its impressive momentum.

Jabil shares hit a 52-week high of 68 in August after slipping to a low of 22 11/16 in October. It also split 2-for-1 back in March.

Assuming Jabil delivers the sales and earnings growth expected of it this quarter, you can bet it will receive a lot more attention from analysts and fund managers in the coming year.