Jacobs Solutions (J) · Q2 2026 results and valuation

At 7.1% growth a year (3-year revenue growth), the model's fair value is $78.49 a share — the stock trades 101% above it. Today's price assumes 15.1% growth a year.

1. Guidance

   J expects its Q4 adjusted EBITDA margin to be approximately 16% and year-over-year net revenue growth to be approximately 14%.

   Source quote

   “As it pertains to Q4, we expect our adjusted EBITDA margin to be approximately 16%, with year-over-year net revenue growth of approximately 14%.”

2. Guidance

   The company expects its tax rate to be roughly 27.5% and quarterly free cash flow to be approximately $150 million.

   Source quote

   “Furthermore, we expect our tax rate to be roughly 27.5% and a quarterly free cash flow to be approximately $150 million.”

3. Figure

   I&AF net revenue reached nearly $2.1 billion, a 10% year-over-year increase and a quarterly record for the segment.

   Source quote

   “Second, I&AF posted nearly $2.1 billion in net revenue, a 10% increase year-over-year and a quarterly record for the segment.”

4. Fading

   Adjusted EPS grew 22% to $1.75, supported by 9% organic net revenue growth, which outperformed the 8% growth rate reported in Q1.

   Source quote

   “First, adjusted EPS grew 22% to $1.75, supported by 9% organic net revenue growth, outpacing the 8% growth rate in Q1... I'll quickly highlight a few key takeaways. Second, our backlog grew 22% to $27 billion, setting another new record with a trailing 12-month book-to-bill of 1.4x on gross revenue and 1.2x on net revenue.”

5. Last period

   Operational improvements across the commercial model and global delivery, including AI integration, are progressing well and are expected to continue to accelerate.

   Source quote

   “So I'd say the vast majority of that comes from the operational improvements across both the commercial model and global... ...about multiple identified initiatives in terms of gross margin drivers, in terms of how we engage with the commercial model, the increased use of AI and so forth. And so that's progressing really well, and we expect that to continue to accelerate.”

Script and answers carried a similar tone, so the script's message held up under questioning.

Sentences that drove the tone

“The combination of strong annual margin expansion, high single-digit organic growth and continued share repurchases enabled by strong free cash flow generation has created a powerful earnings growth algorithm.”

“Our backlog is at a record level, and our pipeline continues to expand, positioning us for profitable growth in FY '27 and beyond.”

“At a high level, we continue to see strong growth rates in Life Sciences and Advanced Manufacturing as well as in critical infrastructure during Q3.”