Jacobs (J) Wins 5.5-Year FCS Deal in Atlanta, Boosts Backlog
Jacobs Solutions Inc. J secured a 66-month contract from Fulton County Schools (FCS), located in Atlanta, GA, to supervise the Education Special Purpose Local Option Sales Tax (ESPLOST) Capital Improvement Program. The contract will implement the Plan 2027 of FCS, which includes $648 million in capital improvements for its facilities, safety and technology systems.
Per the deal, Jacobs will help FCS in the construction of five new schools, and major renovations at 18 other schools and two non-instructional facilities within the school district.
In the context of the contract, Katus Watson, Jacobs’ senior vice president and general manager, said, “Delivering nearly 300 projects in the past ten years to improve FCS' infrastructure, technology and safety systems affirms our promise to create a more connected, sustainable world. We'll continue to be a robust, collaborative partner focused on innovation and integrated solutions to help deliver the best learning environments for the next generation of thinkers and doers.”
Jacobs, along with Gude Management Group and Corporate Environmental Risk Management, will also provide services for the districtwide renovation of elementary school media centers, improvement of audiovisual and IT systems, renovation of roofing, heating, ventilation and air conditioning (HVAC) and energy-efficient lighting systems, as well as upgrades to fire protection and communication systems.
The recent deal is the third consecutive five-year contract awarded to Jacobs. The company has managed construction projects of more than $1 billion for FCS since 2012.
Growth Drivers
Jacobs’ ongoing contract wins portray the company’s efficient project execution capabilities, which are driving its performance over the last few quarters.
The Boldly Moving Forward strategy undertaken by Jacobs in 2022 comprises operational discipline to capture the high-growth opportunities emerging across Climate Response, Data Solutions and Consulting & Advisory. This strategy is creating compelling returns for the company while advancing sustainability and social value in global communities.
As of Dec 30, 2022, the company’s total backlog was $28.3 billion, up 1% year over year.
Although the professional, technical and construction services provider is gaining from consistent contract wins, its growth is affected by foreign exchange risks in international businesses and expected increase in incentive costs.
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In the past six months, shares of Jacobs have declined 4.2% compared with the Zacks Technology Services industry’s decline of 8.4%.
Zacks Rank & Key Picks
Jacobs currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks from the Zacks Business Services sector are:
SPS Commerce, Inc. SPSC currently sports a Zacks Rank #1. SPSC delivered a four-quarter average earnings surprise of 16.3%. The company’s shares have risen 18.1% in the past six months.
The Zacks Consensus Estimate for SPSC’s 2023 sales and EPS indicates growth of 16.5% and 13.2%, respectively, from the prior-year reported figures.
Omnicom Group Inc. OMC flaunts a Zacks Rank #1 at present. OMC came up with a four-quarter average earnings surprise of 8%. The stock has risen 26% in the past six months.
The Zacks Consensus Estimate for OMC’s 2023 sales and EPS indicates growth of 2.7% and 3.2%, respectively, from the prior-year reported figures.
Trane Technologies plc TT currently sports a Zacks Rank #1. TT has a trailing four-quarter earnings surprise of 8.2%, on average. Shares of the company have gained 12.3% in the past six months.
The Zacks Consensus Estimate for TT’s 2023 sales and EPS indicates growth of 7.7% and 13.3%, respectively, from the year-ago reported levels.
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