Earnings Preview:JEC - Analyst Blog
July 25 2011 - 7:15AM
Zacks
Jacobs Engineering Group
Inc. (JEC) will be reporting its third-quarter 2011
earnings on Tuesday, July 26, 2011.
The current Zacks Consensus
Estimate for earnings per share (EPS) is 70 cents, representing an
annualized growth of 11.67%.
With respect to earnings surprises
over the trailing four quarters, JEC outperformed the Zacks
Consensus Estimate in one quarter; was in line in another and
lagged behind in two other quarters. Average earnings surprise was
a negative 0.56%. The average earnings surprise implies that the
company underperformed the Zacks Consensus Estimate by the same
magnitude over the last four quarters.
Second Quarter
Highlights
Jacobs Engineering Group reported
its financial results for the second quarter of 2011 with net
earnings per share of 63 cents in the quarter, up from 62 cents
reported in the year-ago quarter. Results were in line with the
Zacks Consensus Estimate of 63 cents.
Top-line results were weak in the
quarter; total revenue plummeted 1.1% year over year to $2,558.0
million but increased 8.6% sequentially and was above the Zacks
Consensus Estimate of $2,523.0 million. The year-over-year decline
can be attributed to lower backlog and Field Services revenue.
Agreement of Estimate
Revisions
In the last 30 days, no analyst
providing estimate increased the company’s earnings per share (EPS)
estimates for the third quarter, while one analyst decreased the
EPS estimate for the current quarter. However, for fiscal 2011, one
analyst increased the estimate while the other decreased the
same.
Magnitude of Estimate
Revisions
Estimates over the last 30 days
remained intact at 70 cents per share for the third quarter of
2011, representing a year-over-year growth of 11.67%.
Estimate for fiscal 2011 inched up
from $2.59 to $2.60 over the last 30 days while that for fiscal
2012 remained static at $3.03. These estimates represented a
year-over-year growth of 4.64% for 2011 and 16.75% for 2012.
Our Take
Jacobs is likely to post impressive
results in the third quarter based on the net contribution from the
company’s acquired businesses of Aker Solutions. Moreover, improved
market trends, strategic contract wins from the federal governments
of UK, US as well as its diversification across geographies,
indicate improved performance, going forward.
Jacobs Engineering Group Inc. is
one of the world's largest engineering and construction companies
providing services to a variety of industrial, commercial and
government clients across a global network. The company directly
competes with its peers, such as Fluor Corporation
(FLR), Foster Wheeler AG (FWLT).
We currently maintain a long-term
Neutral recommendation on the stock. Jacobs has a Zacks #3 Rank,
which translates into a short-term Hold rating (1-3 months).
FLUOR CORP-NEW (FLR): Free Stock Analysis Report
FOSTER WHELR AG (FWLT): Free Stock Analysis Report
JACOBS ENGIN GR (JEC): Free Stock Analysis Report
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