Kovitz Investment: “Jacobs (J)’s Current Share Price Offers High Probability of Meaningful Returns”

Kovitz Investment Group Partners, an investment management firm, published its “Kovitz Core Equity” first-quarter 2022 investor letter – a copy of which can be downloaded here. During the first quarter of 2022, the Kovitz Equity Composite (the “Composite”) decreased by 4.9%, net of all fees. By way of comparison, the S&P 500 was down 4.6% while the Russell 1000 Value Index fell 0.7% for the same period. Try to spend some time taking a look at the fund’s top 5 holdings to be informed about their best picks for 2022.

In its Q1 2022 investor letter, Kovitz Core Equity mentioned Jacobs Engineering Group Inc. (NYSE:J) and explained its insights for the company. Founded in 1947, Jacobs Engineering Group Inc. (NYSE:J)  is a Dallas, Texas-based international technical professional services firm with a $17.8 billion market capitalization. Jacobs Engineering Group Inc. (NYSE:J)  delivered a -1.01% return since the beginning of the year, while its 12-month returns are up by 0.82%. The stock closed at $137.83 per share on April 25, 2022.

Here is what Kovitz Core Equity has to say about Jacobs Engineering Group Inc. (NYSE:J) in its Q1 2022 investor letter:

Jacobs is a name that we have successfully owned before, having recently exited the position between $130-$140 per share in the April-June timeframe of last year. While our new entry price is only slightly below those levels, our internal estimates for the company’s long-term earnings power have increased dramatically. Recent developments related to the Infrastructure Investment and Jobs Act bill signed into law last November and clearer indications of contract wins in secular growth fields such as life science, semiconductor manufacturing, and cyberdefense have driven upward revisions to our financial models. Combined with our long-standing appreciation of CEO Steve Demetriou and the likelihood that these newer contracts will have better economic terms for Jacobs than prior commitments, we think the current share price offers a high probability of meaningful returns with less potential economic sensitivity than in the company’s past.”

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Our calculations show that Jacobs Engineering Group Inc. (NYSE:J) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Jacobs Engineering Group Inc. (NYSE:J) was in 31 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 20 funds in the previous quarter. Jacobs Engineering Group Inc. (NYSE:J) delivered a 8.37% return in the past 3 months.

In November 2021, we also shared another hedge fund’s views on Jacobs Engineering Group Inc. (NYSE:J) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.