Jacobs Solutions Stock Pulls Back to Support – Smart Entry?
Jacobs Solutions (J) stock should be on your watchlist. Here is why – it is currently trading in the support zone ($122.33 – $135.21), levels from which it has bounced meaningfully before. In the last 10 years, Jacobs Solutions stock received buying interest at this level 3 times and subsequently went on to generate 11.3% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 5/2/2025 | 3.0% | 14 |
| 6/2/2025 | 8.1% | 37 |
| 7/9/2025 | 22.8% | 104 |
Yet, a support zone alone isn’t enough; rebounds are more likely when fundamentals, sentiment, and market conditions line up. How does that look for J?
Rebound Likely
Jacobs’ robust Q4 fiscal 2025 adjusted EPS beat and strong FY26 guidance project double-digit EPS growth and 6-10% revenue expansion, underpinned by a record $23.1 billion backlog. While GAAP earnings dipped due to non-cash Amentum adjustments, core segments like data centers, water, and transportation show significant tailwinds. Analyst average price targets imply ~20% upside from current levels. Despite recent stock price weakness on GAAP headlines, solid operational fundamentals, strategic focus on high-growth sectors, and consistent shareholder returns suggest a technical bounce from support.
How Do J Financials Look Right Now?
- Revenue Growth: 61.5% LTM and 1.1% last 3-year average.
- Cash Generation: Nearly 3.5% free cash flow margin and 7.2% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for J was -32.2%.
- Valuation: J stock trades at a PE multiple of 31.4
| J | S&P Median | |
|---|---|---|
| Sector | Industrials | – |
| Industry | Construction & Engineering | – |
| PE Ratio | 31.4 | 23.0 |
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| LTM* Revenue Growth | 61.5% | 6.1% |
| 3Y Average Annual Revenue Growth | 1.1% | 5.4% |
| Min Annual Revenue Growth Last 3Y | -32.2% | 0.2% |
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| LTM* Operating Margin | 7.2% | 18.8% |
| 3Y Average Operating Margin | 6.3% | 18.2% |
| LTM* Free Cash Flow Margin | 3.5% | 13.5% |
*LTM: Last Twelve Months | For more details on J fundamentals, read Buy or Sell J Stock.
And What If The Support Breaks?
Stock J isn’t immune to big pullbacks. It dropped 74% in the Global Financial Crisis and 37% in the Dot-Com bubble. Even more recent shocks hit hard—down 39% during Covid and 26% in the inflation shock. The 2018 correction saw a 32% dip too. Despite any strong fundamentals, when markets turn south, Stock J shows it can still suffer major losses.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read J Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
Still not sure about J stock? Consider the portfolio approach.
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The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.