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Jacobs Gears Up to Report Q4 Earnings: Things to Keep in Mind
JJacobs Solutions (J) ZACKS·2024-11-14 18:10

Core Viewpoint - Jacobs Solutions, Inc. is expected to report its fourth-quarter fiscal 2024 results on November 19, with a consensus estimate for earnings per share (EPS) showing a 9.5% increase year-over-year [1][3]. Financial Performance - In the last reported quarter, Jacobs' earnings exceeded the Zacks Consensus Estimate by 0.5%, while revenues fell short by 3.5%. Year-over-year, adjusted earnings grew by 11.4% and revenues increased by 1.1% [2]. - The Zacks Consensus Estimate for EPS has risen to 2.08from2.08 from 2.07 over the past 60 days, compared to 1.90 in the same quarter last year [3]. Revenue Growth Factors - Revenue growth in Q4 is anticipated due to investments from the U.S. Infrastructure Act and other economic incentives, alongside Jacobs' strategic shift towards becoming a technology solutions provider [4]. - The company is expected to benefit from a backlog with higher margins, efficiency improvements through digital advancements, and strong project execution [5]. Segment Performance - The People & Places Solutions (P&PS) segment, which accounted for 58.4% of total revenues in fiscal 2023, is projected to show continued organic growth, driven by a strong backlog in water infrastructure and environmental projects [8]. - The consensus estimate for P&PS revenues is 2.68 billion, up from 2.51billionyear−over−year,withoperatingprofitexpectedtoriseto2.51 billion year-over-year, with operating profit expected to rise to 286 million from 256million[9].−TheCriticalMissionSolutions(CMS)segment,whichrepresented28.7256 million [9]. - The Critical Mission Solutions (CMS) segment, which represented 28.7% of total revenues in fiscal 2023, is expected to see revenues of 1.243 billion, a slight increase from 1.236billionayearago,withoperatingprofitanticipatedtogrowto1.236 billion a year ago, with operating profit anticipated to grow to 109 million from 103million[10][12].StrategicDevelopments−JacobsannouncedplanstoseparatetheCMSbusinesstoenhancefocusonhigher−growthareas,culminatinginamergerwithAmentum,whichwascompletedonSeptember27,2024[11].−ThePAConsultingsegment,accountingfor7.1103 million [10][12]. Strategic Developments - Jacobs announced plans to separate the CMS business to enhance focus on higher-growth areas, culminating in a merger with Amentum, which was completed on September 27, 2024 [11]. - The PA Consulting segment, accounting for 7.1% of total revenues, is expected to report revenues of 303 million, up from 288millionyear−over−year,withoperatingprofitprojectedtoincreaseto288 million year-over-year, with operating profit projected to increase to 64 million from $59 million [14]. Cost Management - Jacobs anticipates increased overhead costs related to the separation of CMS, which may temporarily affect segment operating margins but is not expected to impact the overall bottom line [15].