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1. Company Snapshot

1.a. Company Description

Jacobs Engineering Group Inc.provides consulting, technical, scientific, and project delivery services for the government and private sectors in the United States, Europe, Canada, India, rest of Asia, Australia, New Zealand, South America, Mexico, the Middle East, and Africa.The company operates in two segments, Critical Mission Solutions and People & Places Solutions.


The Critical Mission Solutions segment provides cybersecurity, data analytics, systems and software application integration and consulting, enterprise and mission IT, engineering and design, nuclear, enterprise level operations and maintenance, and other technical consulting solutions.The People & Places Solutions segment offers data analytics, artificial intelligence and automation, software development, digitally driven consulting, planning and architecture, program management, and other technical consulting solutions.The company is also involved in the management and execution of wind-tunnel design-build projects; and design-build for water and construction management.


Jacobs Engineering Group Inc.was founded in 1947 and is headquartered in Dallas, Texas.

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1.b. Last Insights on J

Jacobs Solutions' recent performance was negatively impacted by a sharp sell-off following its Q4 earnings release, despite the company reporting strong results, with EPS up 27.7% and margins expanding sharply. The sell-off was attributed to a looming one-time tax event in 2026 and challenges in the environmental sector. However, the company's record backlog of $23.1 billion and growth in life sciences, advanced manufacturing, and critical infrastructure are positives. Analysts have revised their earnings estimates higher, indicating a potential trend reversal. (Source: Bloomberg)

1.c. Company Highlights

2. Jacobs Solutions' Strong Q4 and FY 2025 Results Driven by Robust Revenue Growth and Margin Expansion

Jacobs Solutions Inc. reported impressive results for Q4 and FY 2025, with double-digit growth in adjusted EPS driven by 6% net revenue growth and robust margin expansion. In Q4, adjusted EPS rose 28% year over year to $1.75, with adjusted EBITDA margin at a record 14.4%. For FY 2025, adjusted EPS grew 16% to $6.12, with mid-single-digit net revenue growth and strong margin expansion. The company's consolidated backlog grew 6% to a record $23.1 billion, providing a solid foundation for future growth.

Publication Date: Nov -21

📋 Highlights
  • Q4 Adjusted EPS Growth:: 28% YoY increase to $1.75, driven by 6% net revenue growth.
  • Record Consolidated Backlog:: Grew 6% to $23.1 billion, reflecting strong demand and project pipeline.
  • 2025 Adjusted EPS Growth:: 16% to $6.12, with EBITDA margin hitting a record 14.4%.
  • Shareholder Returns:: $1.1 billion returned in FY 2025 via buybacks and dividends, a company record.
  • Data Center Pipeline Growth:: 5x increase, with expansion into new geographies and innovation in server rack integration.

Guidance and Outlook

The company provided guidance for FY 2026, expecting adjusted net revenue growth of 6-10%, adjusted EBITDA margin of 14.4-14.7%, and adjusted EPS growth of 16% year over year at the midpoint. The company also expects free cash flow margin of 7-8%, which is slightly lower than its long-term target of 10% due to one-time tax events and cash expenses related to the combination with PA Consulting.

Segment Performance and Trends

In the Infrastructure and Advanced Facilities segment, margins have improved, driven by solid performance across the business and efficient cash collections. The company expects a sequential slowdown in Q1, but a linear progression in margins throughout the rest of the year. Jacobs is also leveraging AI to provide greater solutions to clients, which has been a differentiator and accelerant for growth, as seen in projects such as a transformational effort for Intel and partnerships with Palantir and NVIDIA.

Valuation and Growth Prospects

With a P/E Ratio of 53.31 and EV/EBITDA of 19.81, the market is pricing in significant growth expectations. Analysts estimate next year's revenue growth at 6.2%. To achieve the high end of its range, the company would need to see continued momentum in end markets such as life sciences and data centers. The company's data center business is currently a $200 million business and has seen a fivefold increase in pipeline, which could be as big as its life sciences business in a few years.

Shareholder Returns and Capital Allocation

Jacobs Solutions Inc. returned $1.1 billion to shareholders in FY 2025, a company record, through share repurchases and dividends. The company plans to use its cash to maintain optionality for additional deployment and to be regular buyers of its stock, aiming to return at least 60% of its free cash flow in the form of share repurchases and dividends.

3. NewsRoom

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Jacobs Solutions Inc. (J) Presents at UBS Global Industrials and Transportation Conference Transcript

Dec -02

Source: seekingalpha.com

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Here's Why Investors Should Hold Onto Jacobs Stock for Now

Dec -01

Source: zacks.com

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Jacobs & Arcadis JV Wins New Rail Project From TMR in Australia

Nov -27

Source:

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Jacobs Is Changing Fast, The Valuation Just Hasn't Noticed

Nov -26

Source: seekingalpha.com

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Jacobs Selected for Transformational Logan and Gold Coast Faster Rail Project in Australia

Nov -26

Source: prnewswire.com

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Jacobs to Manage Infrastructure Development Program to Support Regional Growth in El Paso, Texas

Nov -25

Source: prnewswire.com

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Jacobs Solutions: Record Backlog And Margin Expansion Behind A Mispriced Sell-Off

Nov -24

Source: seekingalpha.com

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Here's Why Jacobs Solutions (J) is Poised for a Turnaround After Losing 19.3% in 4 Weeks

Nov -24

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.57%)

6. Segments

People & Places Solutions

Expected Growth: 5.5%

Jacobs' People & Places Solutions segment growth of 5.5% is driven by increasing demand for infrastructure development, urbanization, and government investments in transportation, water, and buildings. Additionally, the company's digital solutions and consulting services for cities and communities contribute to its growth.

Critical Mission Solutions

Expected Growth: 5.8%

Jacobs' Critical Mission Solutions segment growth of 5.8% is driven by increasing demand for cyber security, intelligence, and IT services from government agencies, as well as expansion in nuclear and environmental services. Additionally, strategic acquisitions and investments in digital solutions have enhanced the company's capabilities, contributing to the segment's growth.

PA Consulting

Expected Growth: 5.2%

PA Consulting's 5.2% growth is driven by increasing demand for digital transformation and innovation services, particularly in the energy and healthcare sectors. The acquisition by Jacobs Engineering Group Inc. has also brought in new capabilities and resources, enabling PA Consulting to expand its service offerings and attract new clients.

Divergent Solutions

Expected Growth: 5.6%

Divergent Solutions' 5.6% growth is driven by increasing demand for digital transformation in the industrial sector, Jacobs' strategic investments in emerging technologies, and the segment's expanding presence in high-growth markets such as renewable energy and advanced manufacturing.

7. Detailed Products

Project Services

Jacobs Engineering Group Inc. provides project services that include project management, engineering, procurement, construction, and commissioning services to clients across various industries.

Operations and Maintenance Services

Jacobs offers operations and maintenance services that include plant operations, maintenance, and repair services to help clients optimize their assets and improve efficiency.

Fabrication and Manufacturing Services

Jacobs provides fabrication and manufacturing services that include modular fabrication, equipment manufacturing, and materials management to support clients' capital projects and operations.

Scientific and Technical Services

Jacobs offers scientific and technical services that include research and development, testing and analysis, and technical consulting to support clients' scientific and technical needs.

Environmental and Nuclear Services

Jacobs provides environmental and nuclear services that include environmental remediation, nuclear decommissioning, and waste management to support clients' environmental and nuclear needs.

Aerospace and Defense Services

Jacobs offers aerospace and defense services that include engineering, testing, and operations support to support clients' aerospace and defense programs.

Buildings and Infrastructure Services

Jacobs provides buildings and infrastructure services that include architecture, engineering, construction, and operations support to support clients' building and infrastructure needs.

8. Jacobs Engineering Group Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Jacobs Engineering Group Inc. operates in a industry where there are few substitutes for its services, however, clients may choose to perform certain tasks in-house, which could pose a moderate threat.

Bargaining Power Of Customers

Jacobs Engineering Group Inc. has a diverse client base, which reduces the bargaining power of individual customers. Additionally, the company's services are often critical to its clients' operations, making it difficult for them to negotiate prices.

Bargaining Power Of Suppliers

Jacobs Engineering Group Inc. relies on a network of suppliers for equipment, materials, and services. While the company has some bargaining power due to its size, suppliers may still have some leverage, particularly if they are specialized or have limited competition.

Threat Of New Entrants

The engineering and construction industry has high barriers to entry, including significant capital requirements, complex regulatory frameworks, and the need for specialized expertise. This makes it difficult for new entrants to compete with established players like Jacobs Engineering Group Inc.

Intensity Of Rivalry

The engineering and construction industry is highly competitive, with many established players competing for a limited number of projects. Jacobs Engineering Group Inc. faces intense competition from rivals such as Bechtel, Fluor, and AECOM, which can lead to pricing pressure and reduced margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 35.29%
Debt Cost 5.99%
Equity Weight 64.71%
Equity Cost 7.51%
WACC 6.98%
Leverage 54.54%

11. Quality Control: Jacobs Engineering Group Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Growth: 5.7

Quality: 5.2

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Momentum: 8.0

Volatility: 9.7

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Jacobs Engineering Group

A-Score: 4.8/10

Value: 2.0

Growth: 5.1

Quality: 5.4

Yield: 1.0

Momentum: 6.5

Volatility: 9.0

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Yield: 3.0

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Value: 1.5

Growth: 8.6

Quality: 3.4

Yield: 0.0

Momentum: 9.0

Volatility: 4.7

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Tetra Tech

A-Score: 4.3/10

Value: 3.0

Growth: 7.3

Quality: 5.5

Yield: 1.0

Momentum: 1.0

Volatility: 8.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

140.22$

Current Price

140.22$

Potential

-0.00%

Expected Cash-Flows