L1 Capital International's Views on Jacobs Solutions (J)

L1 Capital, an investment management firm, released its “L1 Capital International Fund” (unhedged) fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. The Strategy focuses on investing in high-quality companies with favorable cashflow-based valuations. The letter highlighted the current investment environment, the Fund’s positioning, portfolio adjustments, and the quarterly (December) and yearly (2025) review. The firm considers valuation analysis essential for potential AI-focused investments; merely having conviction in AI isn't enough to ensure a successful investment outcome. In general, 2025 was a strong year for all stock markets globally. The fund returned 2.2%, net of fees, compared to 2.5% for the benchmark (MSCI World Net Total Return Index in AUD). For the year, the fund returned 9.8% (net of fees) compared to 12.4% for the Index. In addition, you can check the Strategy’s top five holdings to know its best picks in 2025.

 In its fourth-quarter 2025 investor letter, L1 Capital International Fund highlighted stocks such as Jacobs Solutions Inc. (NYSE:J). Jacobs Solutions Inc. (NYSE:J) is a leading provider of infrastructure and advanced facilities, and consulting. On January 14, 2026, Jacobs Solutions Inc. (NYSE:J) stock closed at $139.00 per share. One-month return of Jacobs Solutions Inc. (NYSE:J) was 4.76%, and its shares gained 1.52% of their value over the last 52 weeks. Jacobs Solutions Inc. (NYSE:J) has a market capitalization of $16.506 billion.

L1 Capital International Fund stated the following regarding Jacobs Solutions Inc. (NYSE:J) in its fourth quarter 2025 investor letter:

"Jacobs Solutions Inc. (NYSE:J) is a global leader in engineering services. We provided an overview of the business in the June 2025 Quarterly Report. The company continues to perform in line with our expectations. During the quarter, a competitor held an investor event and created an impression that AI could be disruptive to the engineering services industry. As discussed further on page 10, we are in an environment where every industry and every company is pigeon-holed into either an ‘AI Winner’ or ‘AI loser’. While almost every industry needs to incorporate and adapt AI, we believe Jacobs Solutions and the engineering services it provides, will be a net beneficiary, and Jacobs Solutions’ management is already actively investing in AI. In addition to discussing this issue with Jacobs Solutions management, we spoke to the competitor and believe their CEO materially mis-spoke at their investor event and they are in damage control mode. We viewed the share price weakness as unjustified and moderately increased our position. After quarter end, Jacobs Solutions acquired the minority interests in subsidiary PA Consulting. This transaction had been well signalled, was strategically sound and the agreed acquisition price was modestly below our expectations, a small positive to our base case valuation."

Jacobs Solutions Inc. (NYSE:J) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 34 hedge fund portfolios held Jacobs Solutions Inc. (NYSE:J) at the end of the third quarter, compared to 35 in the previous quarter. While we acknowledge the potential of Jacobs Solutions Inc. (NYSE:J) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Jacobs Solutions Inc. (NYSE:J) and shared the list of stocks Jim Cramer discussed. L1 Capital International Fund outlined its investment thesis for Jacobs Solutions Inc. (NYSE:J) in its Q2 2025 investor letter. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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