On Thursday, RBC Capital adjusted its outlook for Jacobs Engineering Group Inc. (NYSE: NYSE:J), lowering the price target to $152 from the previous $167. The firm maintained its Outperform rating on the company's shares. The revision follows Jacobs Engineering's fourth-quarter and full-year 2024 results, which aligned closely with consensus estimates. The company's forecast for fiscal year 2025 also met expectations, indicating a moderate to high single-digit percentage increase in top-line growth.
The price target adjustment reflects a $15 decrease from the prior target, with RBC Capital analysts citing the recent financial performance and future prospects. Jacobs Engineering had previously separated its CMS/C&I business on September 27, which is an important factor in the firm's current valuation and outlook.
Analysts are now turning their attention to Jacobs Engineering's upcoming investor day in February, where the company is expected to set medium-term targets and unveil its forward-looking strategy. This event will be crucial for investors to understand the company's direction and growth plans in the coming years.
The price target change comes as Jacobs Engineering continues to navigate its post-spinoff landscape, with the market anticipating further details on how the company will drive future growth. The Outperform rating indicates that RBC Capital remains positive about the company's potential despite the revised price target.
Jacobs Engineering Group Inc., a renowned professional services firm, is poised to share more about its strategic initiatives and performance goals at the investor day, which could provide additional insights into the company's value and trajectory in the market.
In other recent news, Jacobs Engineering Group Inc. has been in the spotlight due to several key developments. The company reported fourth-quarter and full-year results, which met expectations, despite adjusted earnings per share of $1.37 and revenue of $3 billion in the fourth quarter falling short of analyst estimates. However, the company saw a strong backlog growth of 22.5% year over year to $21.8 billion, indicating robust future performance.
KeyBanc maintained its Sector Weight rating for Jacobs Engineering, while Baird increased the company's stock price target from $147 to $149, maintaining an Outperform rating due to the company's promising first quarter performance. Jacobs Engineering also completed the spinoff of its CMS business to Amentum, a move that is expected to enhance operational efficiency.
In anticipation of future developments, Jacobs Engineering is expected to detail its post-spinoff strategy and present a long-term framework at an upcoming investor event. For Fiscal Year 2025, the company's guidance estimates adjusted earnings per share to be between $5.80 and $6.20, expecting mid-to-high single digit revenue growth and an adjusted EBITDA margin of 13.8% to 14%.
InvestingPro Insights
To complement RBC Capital's analysis of Jacobs Engineering Group Inc. (NYSE: J), InvestingPro data offers additional context for investors. Despite the lowered price target, Jacobs maintains a solid financial foundation. The company's P/E ratio of 27.87 and adjusted P/E ratio of 24.17 for the last twelve months suggest that investors are willing to pay a premium for its earnings, possibly due to growth expectations.
Jacobs' revenue for the last twelve months stands at $11.5 billion, with a gross profit margin of 24.63%. While the company experienced a revenue decline of 29.67% over the same period, it maintains profitability with an operating income margin of 7.27%.
InvestingPro Tips highlight that Jacobs has raised its dividend for 6 consecutive years, demonstrating a commitment to shareholder returns. This is further supported by a current dividend yield of 0.88% and a notable dividend growth of 11.54% over the last twelve months. Additionally, analysts predict the company will remain profitable this year, aligning with RBC Capital's Outperform rating.
For investors seeking a deeper dive into Jacobs' financials and prospects, InvestingPro offers 6 additional tips, providing a more comprehensive analysis to inform investment decisions.
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