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Jacobs Solutions
(NYSE:J)
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Rating:60Neutral
Price Target:
$124.00
▼(-3.82% Downside)
Action:Reiterated
Date:05/09/26
The score is held back primarily by softer recent financial quality (margin compression, sharply lower TTM free cash flow, and higher leverage) and a bearish technical setup (below major moving averages with negative MACD). These are partially offset by a strong earnings-call outlook with raised FY2026 guidance, record backlog, and accelerating AI/data-center demand, while valuation support is limited due to a negative P/E and only modest yield.
Positive Factors
Record backlog and book-to-bill
A $27B backlog and a 1.4x gross book-to-bill provide multi-year revenue visibility and backlog-convertibility into billings. This durable contracted pipeline reduces organic revenue volatility, supports utilization planning, and underpins medium-term revenue and margin stability.
Negative Factors
Margin compression and profitability volatility
Material margin deterioration and volatility weaken sustainable earnings power and cash conversion. Lower margins reduce buffer for project overruns, constrain reinvestment capacity, and make target leverage and buyback plans more execution‑sensitive over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Record backlog and book-to-bill
A $27B backlog and a 1.4x gross book-to-bill provide multi-year revenue visibility and backlog-convertibility into billings. This durable contracted pipeline reduces organic revenue volatility, supports utilization planning, and underpins medium-term revenue and margin stability.
Read all positive factors
Jacobs Solutions Key Performance Indicators (KPIs)
Any
Revenue by Geography
Revenue split across regions reveals where Jacobs earns most of its sales and where growth or downside risks are concentrated. Large exposure to the U.S. points to sensitivity to federal, state and municipal infrastructure spending, while strength in international markets shows geographic diversification and different demand cycles.
Revenue split across regions reveals where Jacobs earns most of its sales and where growth or downside risks are concentrated. Large exposure to the U.S. points to sensitivity to federal, state and municipal infrastructure spending, while strength in international markets shows geographic diversification and different demand cycles.
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The Fly
The FlyJacobs Solutions (J) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$15.10B
Dividend Yield0.94%
Average Volume (3M)1.46M
Price to Earnings (P/E)39.2
Beta (1Y)0.89
Revenue Growth0.95%
EPS Growth-10.51%
CountryUS
Employees43,000
SectorIndustrials
Sector Strength72
IndustryEngineering & Construction
Share Statistics
EPS (TTM)3.26
Shares Outstanding118,080,880
10 Day Avg. Volume1,590,958
30 Day Avg. Volume1,463,535
Financial Highlights & Ratios
PEG Ratio-0.99
Price to Book (P/B)4.88
Price to Sales (P/S)1.48
P/FCF Ratio29.23
Enterprise Value/Market Cap1.17
Enterprise Value/Revenue1.34
Enterprise Value/Gross Profit5.74
Enterprise Value/Ebitda19.80
Forecast
1Y Price Target
$157.00Price Target Upside21.77% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)7.24
Revenue Forecast (FY)$9.50B
Jacobs Solutions Business Overview & Revenue Model
Company Description
Jacobs Solutions Inc. engages in the infrastructure and advanced facilities, and consulting businesses in the United States, Europe, Canada, India, Asia, Australia, New Zealand, the Middle East, and Africa. The company provides consulting, plannin...
How the Company Makes Money
Jacobs makes money primarily by delivering fee-based professional services and program delivery work under contracts with government agencies and commercial customers. Revenue is largely generated through (1) consulting, engineering, and design fe...
Jacobs Solutions Earnings Call Summary
Earnings Call Date:May 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 11, 2026
Earnings Call Sentiment Positive
The call conveyed a substantially positive operational and commercial momentum: strong top-line growth (gross revenue +27%, adjusted net revenue +9%), record backlog (+22% to $27B), double-digit EPS growth (+22%), rapid expansion in AI/data center demand (data center +100% YoY; AI ecosystem >40% growth), and an increased FY2026 outlook. Key strategic moves—completion of the PA Consulting acquisition, identified synergies (~$20M+) and an upgraded multi-year margin and free-cash-flow target—support upside. Near-term caveats include Q2 adjusted free cash outflow driven by transaction cash accounting, elevated net leverage (2.1x) until deleveraging occurs, a wider GAAP-to-adjusted EPS spread in Q2, and soft performance in parts of the environmental business. Overall, positive operating execution and bookings materially outweigh the near-term cash and integration headwinds.Positive Updates
Strong EPS and Margin Expansion
Adjusted EPS grew 22% year-over-year to $1.75 in Q2, supported by 70 basis points of year-over-year margin expansion. Adjusted EBITDA was $327 million, up more than 14%, with an adjusted EBITDA margin of 14.1%.
Negative Updates
Q2 Adjusted Free Cash Flow Outflow and Transaction Cash Impact
Q2 adjusted free cash outflow was $272 million (reversal of favorable Q1 timing item contributed). First half adjusted free cash flow was $93 million. Transaction accounting for the PA acquisition impacted reported operating cash flow by approximately $233 million in Q2 and is expected to impact Q3 by just over $100 million (including ~$235 million of compensation acceleration and ~ $101M–$105M of employee benefit trust payments).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong EPS and Margin Expansion
Adjusted EPS grew 22% year-over-year to $1.75 in Q2, supported by 70 basis points of year-over-year margin expansion. Adjusted EBITDA was $327 million, up more than 14%, with an adjusted EBITDA margin of 14.1%.
Read all positive updates
Company Guidance
Jacobs raised its FY‑2026 outlook (inclusive of PA) to organic net revenue growth of 8.0–10.5%, an adjusted EBITDA margin of 14.6–14.9%, adjusted EPS of $7.10–$7.35 (implying ~18% YoY EPS growth at the midpoint), and an adjusted free cash flow margin of 7.0–8.5%; near‑term, management expects Q3 adjusted EBITDA margin ≈15% with ~7.5% YoY net revenue growth and an adjusted effective tax rate of 27–28% (Q3–Q4), and Q4 margin above 16% on double‑digit top‑line growth (including an extra week). They reaffirmed FY‑2029 targets of 6–8% organic CAGR (central view ≥7%), adjusted EBITDA margin 17%+, an 11%+ free cash flow margin (implying $1.2–$1.3B annual FCF by FY‑2029), at least $20M of annual cost synergies from PA, identified 75 bps of annual margin improvement for 2027–2029 (after ~200 bps in FY25–26), and a balance‑sheet path from ~2.1x net leverage now to <2.0x by year‑end and ~1.5x in FY2027.Jacobs Solutions Financial Statement Overview
Summary
Income Statement
70
Positive
Balance Sheet
58
Neutral
Cash Flow
63
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 13.17B | 12.03B | 11.50B | 10.85B | 9.78B | 14.09B |
| Gross Profit | 3.08B | 2.98B | 2.83B | 2.71B | 2.58B | 3.04B |
| EBITDA | 893.63M | 926.84M | 1.26B | 996.31M | 878.74M | 1.02B |
| Net Income | 384.27M | 290.25M | 806.09M | 665.78M | 644.04M | 477.03M |
Balance Sheet | ||||||
| Total Assets | 11.94B | 11.25B | 11.76B | 14.62B | 14.66B | 14.63B |
| Cash, Cash Equivalents and Short-Term Investments | 1.37B | 1.24B | 1.89B | 770.85M | 1.14B | 1.01B |
| Total Debt | 4.56B | 2.71B | 2.75B | 3.47B | 4.17B | 3.82B |
| Total Liabilities | 8.66B | 6.59B | 6.37B | 7.38B | 7.92B | 8.00B |
| Stockholders Equity | 3.29B | 3.64B | 4.55B | 6.55B | 6.06B | 5.94B |
Cash Flow | ||||||
| Free Cash Flow | 484.09M | 607.47M | 933.56M | 837.28M | 347.09M | 633.46M |
| Operating Cash Flow | 572.32M | 686.70M | 1.05B | 974.76M | 474.71M | 726.28M |
| Investing Cash Flow | -87.11M | -75.29M | -127.19M | -145.66M | -538.42M | -1.38B |
| Financing Cash Flow | -235.44M | -525.22M | -751.64M | -1.09B | 320.23M | 798.98M |
Jacobs Solutions Technical Analysis
Positive
128.93
Price Trends
121.72
Positive
126.73
Positive
135.27
Negative
Market Momentum
1.22
Negative
58.82
Neutral
85.93
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For J, the sentiment is Positive. The current price of 128.93 is above the 20-day moving average (MA) of 123.69, above the 50-day MA of 121.72, and below the 200-day MA of 135.27, indicating a neutral trend. The MACD of 1.22 indicates Negative momentum. The RSI at 58.82 is Neutral, neither overbought nor oversold. The STOCH value of 85.93 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for J.
Jacobs Solutions Risk Analysis
Jacobs Solutions disclosed 62 risk factors in its most recent earnings report. Jacobs Solutions reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Jacobs Solutions Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $100.29B | 90.68 | 13.03% | 0.09% | 21.09% | 17.37% | |
74 Outperform | $7.76B | 17.80 | 24.36% | 0.74% | -6.06% | 139.35% | |
72 Outperform | $29.51B | 64.61 | 14.53% | ― | 22.59% | 111.23% | |
69 Neutral | $18.35B | -59.97 | 9.71% | ― | 14.55% | -303.35% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
63 Neutral | $8.71B | 16.13 | 21.32% | 1.06% | -0.38% | 2.58% | |
60 Neutral | $15.10B | 39.23 | 10.82% | 0.94% | 0.95% | -10.51% |
* Industrials Sector Average
J
Jacobs Solutions
127.89
-3.12
-2.38%
ACM
Aecom Technology
67.74
-46.17
-40.53%
MTZ
MasTec
373.43
201.45
117.14%
PWR
Quanta Services
668.31
282.84
73.37%
TTEK
Tetra Tech
29.90
-6.21
-17.20%
APG
APi Group
41.98
7.69
22.43%
Jacobs Solutions Corporate Events
Executive/Board ChangesRegulatory Filings and Compliance
Jacobs Solutions Announces Routine Board-Level Director Resignation
Neutral
Apr 29, 2026
On April 26, 2026, Jacobs Solutions Inc. announced that Diane Bryant resigned from its Board of Directors, with the company stating that her departure did not arise from any disagreement regarding its operations, policies or practices. The resigna...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Jacobs Solutions Secures New Credit Facilities for Acquisition
Positive
Mar 17, 2026
On March 16–17, 2026, Jacobs Solutions put in place a new $1.5 billion multi‑currency revolving credit facility maturing in 2031 and a combined $1.2 billion term loan structure, replacing its existing revolver and expanding liquidity. ...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Jacobs Solutions Prices $1.3 Billion Senior Notes Offering
Positive
Mar 4, 2026
On March 3, 2026, Jacobs Solutions completed an offering of $1.3 billion in senior unsecured notes, issuing $800 million of 4.750% notes due 2031 and $500 million of 5.375% notes due 2036, fully and unconditionally guaranteed by subsidiary Jacobs ...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Jacobs Issues Senior Notes to Fund PA Consulting Acquisition
Positive
Feb 27, 2026
On February 24, 2026, Jacobs Solutions Inc. and its subsidiary Jacobs Engineering Group Inc. entered into an agreement with a syndicate of underwriters to issue $800 million of 4.750% Senior Notes due 2031 and $500 million of 5.375% Senior Notes d...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.