Value
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.3 |
| P/S | 9.6 |
| EV/EBITDA | 1.3 |
| Fwd P/E | 7.8 |
| PEG | 10.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 15.5x
- ▸PEG: 0.40
J · Why this verdict
Why Jacobs Solutions (J) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality scores just below the minimum floor at 3.7 — driven by negligible gross margins and no identified competitive advantage — raising the question of how durable the earnings growth is if the business lacks structural pricing power. Warnings | Quality score rises to 4.0 or above for 2 consecutive evaluation periods, driven by margin expansion or moat development becoming visible in financial results. | →Stable |
| CounterThe company converts free cash flow at 134% of net income — a level well above parity — suggesting actual cash generation is stronger than thin reported margins imply, and the PEG of 0.39 indicates the growth is not being fully priced in. | ||
The company has beaten earnings estimates in each of the last four quarters, consistently delivering above expectations with surprises of 7.1%, 1.8%, 4.2%, and 5.4% in successive periods — a track record of reliable execution that supports a higher fundamental floor. Catalyst breakdown | EPS beats continue for at least 2 of the next 4 quarters, with average quarterly surprise remaining above 3%. | →Stable |
| CounterThe average beat of roughly 4.6% is modest, and a recent officer departure or appointment flagged in regulatory filings introduces leadership uncertainty that could disrupt the execution cadence before the streak can extend further. | ||
At the current price, 14.3% upside remains to the analyst consensus target of $142.44, and the risk/reward geometry is 2.13-to-1 — a setup that compensates for holding risk and clears the asymmetry bar required for a full position. Price targets | Price closes within 5% of $142.44 within the next 12 months, with analyst targets holding steady or rising. | →Stable |
| CounterAnalyst targets typically lag deteriorating price action; with the stock in a confirmed downtrend below the 200-day moving average, consensus targets may be revised lower before the price recovers to meet them. | ||
The stock is trading below its 200-day moving average with a downward slope of -2.5% over 30 days, accompanied by a death cross and falling on-balance volume — indicators that sellers remain in control of near-term price direction regardless of the fundamental beat streak. Momentum breakdown | Price reclaims the 200-day moving average and on-balance volume turns positive, both sustained for 30 consecutive days, signaling the downtrend has been reversed. | →Stable |
| CounterThe MACD is improving and the RSI at 64 is recovering from weakness, which the technical setup characterizes as a death cross in the process of being reversed — not a confirmed breakdown; the momentum score at 5.1 is already above the recovery threshold. | ||
Business quality scores just below the minimum floor at 3.7 — driven by negligible gross margins and no identified competitive advantage — raising the question of how durable the earnings growth is if the business lacks structural pricing power.
→StableWarnings
- Expectation
- Quality score rises to 4.0 or above for 2 consecutive evaluation periods, driven by margin expansion or moat development becoming visible in financial results.
CounterThe company converts free cash flow at 134% of net income — a level well above parity — suggesting actual cash generation is stronger than thin reported margins imply, and the PEG of 0.39 indicates the growth is not being fully priced in.
The company has beaten earnings estimates in each of the last four quarters, consistently delivering above expectations with surprises of 7.1%, 1.8%, 4.2%, and 5.4% in successive periods — a track record of reliable execution that supports a higher fundamental floor.
→StableCatalyst breakdown
- Expectation
- EPS beats continue for at least 2 of the next 4 quarters, with average quarterly surprise remaining above 3%.
CounterThe average beat of roughly 4.6% is modest, and a recent officer departure or appointment flagged in regulatory filings introduces leadership uncertainty that could disrupt the execution cadence before the streak can extend further.
At the current price, 14.3% upside remains to the analyst consensus target of $142.44, and the risk/reward geometry is 2.13-to-1 — a setup that compensates for holding risk and clears the asymmetry bar required for a full position.
→StablePrice targets
- Expectation
- Price closes within 5% of $142.44 within the next 12 months, with analyst targets holding steady or rising.
CounterAnalyst targets typically lag deteriorating price action; with the stock in a confirmed downtrend below the 200-day moving average, consensus targets may be revised lower before the price recovers to meet them.
The stock is trading below its 200-day moving average with a downward slope of -2.5% over 30 days, accompanied by a death cross and falling on-balance volume — indicators that sellers remain in control of near-term price direction regardless of the fundamental beat streak.
→StableMomentum breakdown
- Expectation
- Price reclaims the 200-day moving average and on-balance volume turns positive, both sustained for 30 consecutive days, signaling the downtrend has been reversed.
CounterThe MACD is improving and the RSI at 64 is recovering from weakness, which the technical setup characterizes as a death cross in the process of being reversed — not a confirmed breakdown; the momentum score at 5.1 is already above the recovery threshold.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Jacobs Solutions has delivered four consecutive earnings beats and carries 14.3% upside to analyst consensus with a 2.13-to-1 risk/reward ratio, but business quality scores just below the minimum threshold with no identified competitive advantage, the stock is in a confirmed downtrend below its 200-day moving average, and the asymmetry has not fully cleared the entry bar — a setup where fundamental execution is ahead of the technical reality.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.1 |
| ROA | 2.9 |
| Gross margin | 0.7 |
| Op margin | 0.0 |
| Net margin | 1.4 |
| Current ratio | 5.3 |
| FCF quality | 9.5 |
| Moat | 4.9 |
| Piotroski F | 5.6 |
- ▸Excellent cash conversion: 134% FCF/NI
- ▸No competitive moat
Growth
9.2/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 9.2 |
- ▸Strong growth: 27% YoY
Momentum
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 10.0 |
| OBV | 5.6 |
| MA position | 6.0 |
| Volume | 0.7 |
- ▸Below 200-MA, MA slope -2.5%/30d — confirmed downtrend
Sentiment
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.3 |
| Analyst rating | 7.3 |
| Price target | 8.0 |
- ▸Analyst upside: 23%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider buying — $477,650 (0.003% of mkt cap)
Peer rank
3.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.3 |
| quality rank | 2.0 |
| growth rank | 6.9 |
Technical
2.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.7 |
| support resistance | 0.9 |
| 52w position | 5.3 |
Risk (lower is worse)
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.7 |
| days to cover | 4.9 |
| volatility | 5.2 |
| put call | 8.3 |
| implied vol | 5.4 |
| beta | 9.0 |
| debt equity | 4.2 |
| news risk | 6.0 |
Catalyst
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 4.8 |
| dividend safety | 7.0 |
| news activity | 7.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 113.0%
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (5)
- MOMENTUM:5.4>=4.5
- INSIDER:OK
- EARNINGS_PROXIMITY:30d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:1.2<1.5@spot
Warning (3)
- MOMENTUM:5.4<5.5 (soft — BUY_NOW allowed but watch)
- DEATH_CROSS:momentum=5.4>=5.0 recovering
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
1.24
Upside
+10.4%
Downside
8.4%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 53
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Growth at 9.2 could not lift the engine output above the verdict floor. Failed gate signal: ASYMMETRY:1.2<1.5@spot.
The strongest dimensions are Growth at 9.2, Sentiment at 7.2, and Value at 6.7; the weakest are Technical at 2.3, Quality at 3.7, and Peer rank at 3.8. The V9 engine flagged 1 failed gate with 3 warnings, producing an asymmetric reward-to-risk of 1.24 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Consistent Earnings Beat Streak
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P2Favorable Risk Reward To Analyst Target
Trip ifStock price rises above $138, compressing remaining upside to the $142.44 target below 4%.
- P3Confirmed Price Downtrend
Trip ifStock price closes above the 200-day moving average and sustains for 30 consecutive days.
- P4Quality Below Minimum Threshold
Trip ifFCF-to-net-income ratio falls below 100% for 2 consecutive quarters, weakening the cash conversion advantage.