Jacobs Solutions Inc. (J) has secured an important contract with CG Semi Private Limited to design a new Outsourced Semiconductor Assembly and Test (OSAT) facility in Sanand, Gujarat. This collaboration is a pivotal moment in India’s expanding semiconductor sector, as Jacobs will provide engineering, procurement, and construction services for the Mini Line, along with serving as the engineering partner for the Main Line of the facility.
Jacobs’ Key Contribution to India’s Semiconductor Sector
The new facility, which covers over 28 acres, will manufacture advanced and legacy semiconductor packages to support industries including automotive, consumer electronics, industrial, and 5G. Jacobs’ involvement is essential to delivering a top-tier OSAT facility, which is vital for India’s ambitions in the global semiconductor landscape.
Jacobs has been recognized as No.1 by Engineering News-Record in Semiconductors, Manufacturing, and Electronic Assembly, drawing on vast experience from similar projects throughout the United States, Europe, and Asia. This role underscores Jacobs’ capacity to provide innovative solutions, which will help CG Semi fortify its semiconductor foothold in the region.
Strategic Move for Jacobs’ Future
This contract aligns seamlessly with Jacobs’ long-term objectives in India. The company has previously engaged in notable projects, such as urban water management and the construction of Biocon Biologics’ largest monoclonal antibodies facility.
Jacobs’ expertise and proven success are critical for the development of CG Semi’s OSAT facility. As India rises as a significant player in the semiconductor industry, this partnership reinforces Jacobs’ leadership position, paving the way for future growth and expanded influence in the region.
By participating in this project, Jacobs not only enhances its presence in India’s burgeoning semiconductor market but also underscores its global prominence in engineering and technological solutions.
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So far this year, J’s shares have risen 6.7%, although this lags behind the 33.5% growth seen in the Zacks Technology Services industry. Current challenges for the company include rising costs and increased restructuring and other charges. In the first nine months of fiscal 2024, the direct costs of contracts surged 5.1% year over year due to ongoing inflation in labor, materials, and associated costs. Additionally, heightened departmental expenses, personnel costs, and unfavorable foreign currency translation present further challenges.
Despite these obstacles, Jacobs stands to benefit from strong global trends, including infrastructure modernization, energy transition, national security, and a potential super-cycle in global supply-chain investments.
Jacobs’ Zacks Rank & Noteworthy Stock Picks
Jacobs currently holds a Zacks Rank of #3 (Hold).
Below are some better-ranked stocks from the Business Services sector:
Sezzle, Inc. (SEZL) has a Zacks Rank of 1 (Strong Buy) and has achieved a trailing four-quarter earnings surprise average of 158.3%. The Zacks Consensus Estimate predicts SEZL’s 2024 sales and earnings per share (EPS) to grow by 38.6% and 436.8%, respectively, from last year’s levels. SEZL shares have skyrocketed by 776% this year.
DocuSign, Inc. (DOCU) also possesses a Zacks Rank of 1, with a trailing four-quarter earnings surprise average of 18.3%. The Zacks Consensus Estimate forecasts DOCU’s 2024 sales and EPS to rise by 6.5% and 15.8%, respectively, compared to the previous year. DOCU shares have gained 15.9% year to date.
Duolingo, Inc. (DUOL) currently sports a Zacks Rank of 2 (Buy) and has delivered a trailing four-quarter earnings surprise average of 92.1%. DUOL shares have increased by 27.7% this year, with the consensus estimate suggesting a 38.6% growth in sales and a 434.3% increase in EPS for 2024 compared to last year.
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Docusign Inc. (DOCU): Free Stock Analysis Report
Jacobs Solutions Inc. (J): Free Stock Analysis Report
Duolingo, Inc. (DUOL): Free Stock Analysis Report
Sezzle Inc. (SEZL): Free Stock Analysis Report
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