Morgan Joseph Downgrades Jacobs Engineering Group (JEC) to Hold; Lowers 2010-11 Estimates

November 18, 2009 8:08 AM EST

Morgan Joseph downgrades Jacobs Engineering Group (NYSE: JEC) from Buy to Hold.

Morgan analyst says, "Jacobs Engineering reported F4Q09 EPS below both our and the Street's estimates on lower revenues and the resulting under-absorption of SG&A costs. However, our primary concern is with the company's view on FY10, which is self-admittedly more pessimistic than that of many other large E&C companies that have already reported quarterly earnings. We have lowered our rating to Hold from Buy given our reduction in estimates. While we remain favorable on Jacobs' preferred relationship business model and long-term EPS growth objective of 15%, we believe a lack of near-term catalysts could keep JEC shares range bound near current levels for the next several months."

"Management provided its initial FY10 EPS guidance with a range of $2.00-$2.60. We have lowered our FY10 EPS estimate to $2.50 from $3.40. We have also lowered our FY11 EPS estimate to $3.00 from $3.90."

To see all the upgrades/downgrades on shares of JEC, visit our Analyst Ratings page.

Jacobs Engineering Group Inc. provides professional, technical, and construction services.

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