Jacobs Solutions (US:J) ZACKS·2025-12-01 18:21Core Insights - Jacobs Solutions Inc. is well positioned for fiscal 2026 with a record backlog, steady demand, and margin momentum, achieving a fourth-quarter adjusted EBITDA margin of 14.4% [1][8] - The company has a record backlog of $23.1 billion, reflecting a 6% year-over-year increase, and a trailing 12-month book-to-bill ratio of 1.1x [6][8] - Jacobs has gained 1.1% in shares year-to-date, outperforming the Zacks Building Products - Miscellaneous industry's decline of 2.1% [3] Financial Performance - Jacobs ended fiscal 2025 with cash and cash equivalents of $1.24 billion, an increase from $1.14 billion at the end of fiscal 2024, while long-term debt rose to $2.24 billion from $1.35 billion [10] - The company reported cash flow from operations of $687 million and free cash flow of $607 million, returning a record $1.1 billion to shareholders [10] Growth Drivers - Jacobs' broad capabilities in digital solutions, advanced manufacturing, and public-sector advisory services, along with notable contract wins, reinforce its market position [2] - Recent contract wins include partnerships with United Utilities in the U.K. and a major transportation award from the New York MTA [7] Market Expansion - Jacobs is expanding its global footprint, particularly in the Middle East, which is experiencing double-digit growth due to major infrastructure programs [9] - The company is also seeing strong demand in Australia and steady recovery in Europe, while the U.S. remains its strongest market [9] Challenges - Near-term pressures include seasonal margin softness, one-time cash costs, and softness in the environmental market [5][11][13] - The environmental segment is facing delays in spending decisions from private-sector clients due to regulatory volatility [13]