Jacobs Solutions Inc. (NYSE: J)

Sector: Industrials Industry: Engineering & Construction CIK: 0000052988
Market Cap 16.94 Bn
P/B 4.65
P/E 58.56
P/S 1.41
ROIC (Qtr) 9.09
Div Yield % 0.91
Rev 1y % (Qtr) 6.57
Total Debt (Qtr) 2.71 Bn
Debt/Equity (Qtr) 0.74

About

Jacobs Solutions Inc., commonly known as Jacobs, operates in the professional services industry and is a global technology-forward solutions company. It was founded in 1947 and is headquartered in Dallas, Texas, with its stock symbol listed on the New York Stock Exchange (NYSE) as J. Jacobs provides a wide range of professional services, including consulting, technical, engineering, scientific, and project delivery services, to clients in various industries such as government, energy, healthcare, and infrastructure. The company's services are categorized...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 1.24B provide 11.13x coverage of short-term debt 111.04M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 686.70M provides exceptional 46.97x coverage of minority interest expenses 14.62M, showing strong core operations.
  • Operating cash flow of 686.70M provides strong 11.26x coverage of stock compensation 60.96M, indicating sustainable incentive practices.
  • Robust free cash flow of 609.80M exceeds capital expenditure of 76.90M by 7.93x, indicating strong organic growth funding capability.
  • Tangible assets of 5.75B provide exceptional 6.12x coverage of deferred revenue 940.62M, showing strong service capability backing.

Bear case

  • Operating cash flow of 686.70M barely covers its investment activities of (75.29M), with a coverage ratio of -9.12, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 686.70M provides thin coverage of dividend payments of (153.03M) with a -4.49 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Operating cash flow of 686.70M provides insufficient coverage of deferred revenue obligations of 940.62M, which is 0.73x, raising concerns about future service delivery capabilities.
  • Operating earnings of 650.68M show weak coverage of depreciation charges of 237.58M, with a 2.74 ratio indicating high capital intensity and potential reinvestment needs.
  • Operating cash flow of 686.70M is outpaced by equity issuance of (719.42M) (-0.95 ratio), indicating concerning reliance on equity markets for funding operations.

Geographical Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Engineering & Construction
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PWR Quanta Services, Inc. 62.71 Bn 61.60 2.31 6.02 Bn
2 FER Ferrovial SE 48.08 Bn 14.25 5.05 -
3 FIX Comfort Systems Usa Inc 35.76 Bn 42.69 4.30 0.39 Bn
4 EME EMCOR Group, Inc. 29.29 Bn 25.91 1.80 0.42 Bn
5 APG APi Group Corp 17.37 Bn 111.36 2.27 3.05 Bn
6 MTZ Mastec Inc 17.01 Bn 51.39 1.24 2.77 Bn
7 J Jacobs Solutions Inc. 16.94 Bn 58.56 1.41 2.71 Bn
8 BLD TopBuild Corp 13.35 Bn 23.52 2.55 3.09 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.66 1.61
EV to Cash from Ops. EV/CFO 27.16 6.94
EV to Debt EV to Debt 6.88 11.81
EV to EBIT EV/EBIT 28.67 17.80
EV to EBITDA EV/EBITDA 16.94 13.77
EV to Free Cash Flow [EV/FCF] EV/FCF 30.59 55.77
EV to Market Cap EV to Market Cap 1.10 1.20
EV to Revenue EV/Rev 1.55 1.65
Price to Book Value [P/B] P/B 4.65 5.81
Price to Earnings [P/E] P/E 58.56 35.89
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.89 2.51
Dividend Payout Ratio % Div Payout % (Qtr) 52.30 25.81
Dividend per Basic Share Div per Share (Qtr) 0.96 0.24
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 18.82 4.05
Interest Coverage Int. cover (Qtr) 4.46 80.15
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 33.09 -166.01
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 7.92 637.72
Dividend Growth (1y) % Div 1y % (Qtr) -17.24 5.87
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -60.81 92.47
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 9.99 8.04
EBIT Growth (1y) % EBIT 1y % (Qtr) -41.20 85.34
EBT Growth (1y) % EBT 1y % (Qtr) -46.15 42.07
EPS Growth (1y) % EPS 1y % (Qtr) -62.36 43.76
FCF Growth (1y) % FCF 1y % (Qtr) -35.11 -20.95
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 5.37 32.46
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.07 1.14
Cash Payout Ratio Cash Payout (Qtr) 0.20 0.05
Cash Ratio Cash Ratio (Qtr) 0.37 0.38
Current Ratio Curr Ratio (Qtr) 1.30 1.55
Debt to Equity Ratio Debt/Equity (Qtr) 0.74 0.89
Interest Cover Ratio Int Coverage (Qtr) 4.46 80.15
Times Interest Earned Times Interest Earned (Qtr) 4.46 80.15
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 7.40 0.40
EBIT Margin % EBIT Margin % (Qtr) 5.41 -2.31
EBT Margin % EBT Margin % (Qtr) 4.20 -4.59
Gross Margin % Gross Margin % (Qtr) 24.80 20.38
Net Profit Margin % Net Margin % (Qtr) 2.40 -5.96