The core opportunity is sustained AI infrastructure buildout plus a shift into power, thermal, and lifecycle services that can support a durable premium to legacy EMS valuation. The key risk is a capex digestion cycle that resets pricing power and multiples.

Jabil compounds by becoming the default “trusted industrializer” for AI-era hardware (high-power racks, cooling, power, and verified supply chains), then layering higher-margin lifecycle/service and compliance capabilities that raise switching costs and soften classic EMS cyclicality.

AI shifts scarcity toward physical throughput, energy-to-rack integration, and verifiable supply chains; Jabil’s global factories + qualification muscle become more valuable as hardware complexity and geopolitics rise.

The upside case is not that Jabil becomes a software-like multiple story, but that it keeps earning a quality premium to traditional EMS by repeatedly winning the hardest-to-scale AI infrastructure builds (power + thermal + integration) and attaching services (deployment, maintenance, verification) that customers will pay for when downtime and supply-chain integrity are existential. The re-rating already achieved caps further multiple expansion; the remaining value creation is mainly steady revenue growth, mix improvement, and continued capital return.

The main risk is “reversion to EMS”: AI demand becomes lumpy, customers squeeze pricing, and valuation compresses. Second-order risks are capital/working-capital timing, and expanding into power deployment/services where warranty/SLA-like liabilities can be asymmetric.

Stock re-rating and larger scale shift expected returns toward execution + buybacks rather than dramatic multiple expansion.

$255.36