J
Jacobs Solutions Inc.
$138.59
Cyclical & Capital-Intensive
80%
Normalized Earnings × Cycle Multiple
Strong
·
Conviction
Overvalued
Trading 54.6% above fair value
You pay
$138.59
Bear
$69.72
Fair
$89.64
Bull
$109.56
Bear
$69.72
-49.7%
$4.98 × 14x
Fair
$89.64
-35.3%
$4.98 × 18x
Bull
$109.56
-20.9%
$4.98 × 22x
Adjust Assumptions
18.0x
4.98$
Key Value Driver
Through-cycle normalized EPS ($4.98)
Implied Market Multiple
27.8x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (38 analysts)
$165.00
Divergence from AlphaVal
46%
Summary
Using 7-year normalized EPS of $4.98 at a 18x cycle multiple, the base-case value is $89.64 per share.
Warnings
Wall Street's average price target is $165.00 (from 38 analysts). Our estimate is 46% below the consensus -- consider that gap carefully.
Key Risks
- Standard 10-year DCF produces unreliable terminal values for cyclicals
- 'Cheap' P/E at cycle peak is the most common value trap — normalize first
- Captive finance subsidiaries have different risk profiles from manufacturing