Zacks.com featured highlights include Jabil, Ciena, Commercial Metals and Plains All American Pipeline

Zacks highlights a relative-price-strength screen into 2026 amid easing inflation, improving growth expectations and heavy AI/data-center investment, recommending Jabil (JBL), Ciena (CIEN), Commercial Metals (CMC) and Plains All American (PAA). Key metrics: Jabil (market cap >$25bn, VGM A) sees fiscal 2026 EPS +18.5% Y/Y with its estimate up 4.5% in 60 days and shares +58% Y/Y; Ciena (VGM B) projects fiscal 2026 EPS +97.7% with 3–5yr EPS growth 41.8%, estimate rising from $4.36 to $5.22 and shares +191.2% Y/Y; Commercial Metals (market cap ~$8bn, VGM A) shows fiscal 2026 EPS +125.2% with estimates +21.3% in 60 days and shares +42.4% Y/Y; Plains (market cap ~$13bn, VGM A) had estimates +6.8% in 60 days, mixed recent beats/misses (two/ four quarters) and units +3.6% Y/Y. The piece is constructive for momentum-focused investors but is primarily a thematic/screen recommendation rather than new company-specific catalysts.

Analysis

Market structure: AI and data‑center capex materially benefit optical networking (CIEN) and contract electronics (JBL) by increasing demand for high‑capacity optics and board/system assembly; Ciena gains pricing power on wavelength and packet optics, JBL on outsourced manufacturing scale, while PAA’s midstream margins depend on crude differentials and are more cyclically exposed. Supply/demand signals point to tight bandwidth equipment lead times (supporting 10–30% FY growth for winners) and mixed metal demand—steel (CMC) tied to construction + scrap tightness supporting margin expansion, while pipeline volumes track oil prices and refinery turnarounds.

Risk assessment: Key tail risks include a sudden Fed tightening that compresses multiples (S&P drawdown 10–20%), a telco capex pause (CIEN revenue slip >15% in 2 quarters), semiconductor shortages hitting JBL gross margins by 200–400bps, or a major pipeline regulatory event rerating PAA by >25%. Immediate (days) moves will be earnings/estimate re‑reads (±10–20%), short term (3–6 months) driven by capex cycles and 60‑day estimate revisions, long term (12–36 months) by structural AI adoption and energy transition.

Trade implications: Implement a tilted long book: establish a 0.8–1.5% portfolio position in CIEN (buy shares or 6‑month 20–30% OTM call spreads) and 1% in JBL (buy shares, hedge with 3‑6 month put protection). Take a 0.75% long in CMC (pairs trade: long CMC, short a steel ETF exposure like SLX at 0.5% to isolate company vs sector) and a cautious 0.5% income position in PAA using covered calls (collect premium; exit if WTI > $90 or price falls >15%). Scale in 25% now, add on 10–15% pullbacks; set stop losses 12–18%.

Key Decisions for Investors

• Establish a 1.0% portfolio long position in CIEN now; complement with a 6‑month call spread (buy 30% OTM call, sell 60% OTM call) to express upside while capping premium; reassess after next quarterly print (within 30–45 days), trim if revenue guidance misses by >5%.
• Initiate a 1.0% long position in JBL equity, hedged with 3‑month 10% OTM puts equal to 30% of notional to protect against component‑driven margin shocks; add remaining 75% of target size on a 10–15% pullback.
• Add a 0.75% long position in CMC and pair with a 0.5% short in SLX (steel ETF) to isolate share‑specific upside; target 20–30% upside in 6–12 months or exit if U.S. housing starts decline >5% QoQ.
• Take a conservative 0.5% income position in PAA by buying shares and selling 3‑month covered calls at ~5% OTM; unwind if WTI/Brent rises above $90 or if quarterly DCF coverage falls <1.2x.
• Implement a pair trade: long CIEN (0.8%) / short PAA (0.4%) to express tech capex vs midstream weakness; close if CIEN underperforms its 30‑day relative strength by >15% or if oil differentials stabilize (WTI/Brent spread narrows <$2 for 30 days).