Jacobs Engineering Group Inc. ( J Quick Quote J - Free Report) announced that it has been picked to provide support to the U.S. Air Force's Architecture and Engineering (AE). Per the contract, Jacobs would provide Indefinite Delivery, Indefinite Quantity support. This is comprised of professional designing and engineering services for maintenance, repairing and streamlining projects, including demolition and clearance. Also, modernization of Air Force facilities, revamping historic airfields, and overall basic developments of roads, railroads and bridges would come under Jacob’s purview. The Architecture and Engineering contract is a multiple-award contract worth up to $2 billion. The contract has five years as a base period and another five-year option for renewal. The contract includes projects with Title I, Title II, and other AE facilities, which may be delivered across the world. Senior vice president of Jacobs Federal & Environmental Solutions, and general manager and retired USAF major general, Tim Byers, said, “As the Air Force plans for the future, we continue to drive leading-edge solutions, mission and quality-of-life facilities and infrastructure while lowering life cycle maintenance costs across the enterprise.” Growth Drivers & Share Performance
Jacobs is majorly benefiting from Federal & Environmental Solutions and Critical Mission Solutions (“CMS”) business. Federal solutions include support to U.S. federal, public sector, private sector and defense contractors.
The CMS business has been demonstrating resiliency and alignment to the diverse set of high-value sectors it serves, such as national security, space exploration, intelligence, nuclear life cycle solutions and deployment of 5G infrastructure. Also, efficient project execution has been one of the main features that are driving Jacobs’ performance for the past few quarters. The company’s ongoing contract wins are evidence of the fact. For first-quarter fiscal 2021, the company’s backlog was $25.1 billion, reflecting a year-over-year increase of 11% (up 7% on a pro-forma basis). This reflects persistent solid demand for Jacobs' consulting services. CMS backlog grew 14% year over year and 4% on a pro-forma basis to $9.7 billion for the fiscal first quarter, which provided strong visibility into the base business. The company’s overall 18-month qualified new business pipeline of more than $30 billion remains very strong. Jacobs’ shares have gained 36.4% over the past six months compared with the industry’s 52.9% rally. Although the company’s shares have underperformed its industry for the said period, earnings estimates for 2021 have moved up in the past 30 days, depicting analysts’ optimism regarding the company’s growth potential. The upward trend is attributable to the company’s continued focus on shifting toward digitalization and leadership in strategic end-markets. Also, the company’s inorganic strategies and solid backlog are likely to drive its near-term results.
Jacobs, which shares space with
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