In the world of investing, timing is everything. As Mark Twain once said, “During the gold rush, it’s a good time to be in the pick and shovel business.” While the origins of this quote may be debated, the underlying message is clear – there are often less obvious ways to profit from emerging market trends.
Take the pharmaceutical industry, for example. In recent years, the rise of GLP-1 agonists like Mounjaro and Zepbound has transformed the treatment landscape for diabetes and obesity patients. Eli Lilly, the manufacturer of these groundbreaking drugs, has seen its stock price soar as a result.
But the investment potential surrounding GLP-1 drugs extends beyond pharma stocks. One company reaping the benefits of this trend is Jacobs Solutions (NYSE: J).
So, what exactly does Jacobs Solutions do? Unlike traditional construction firms, Jacobs specializes in complex infrastructure projects such as data centers, spacecraft, and life sciences facilities. With clients like NASA, Procter & Gamble, and Bristol Myers Squibb, the company has established itself as a leader in this space.
What sets Jacobs Solutions apart is its unique partnership with Lilly in the development of GLP-1 facilities. In a recent interview with CNBC’s Jim Cramer, CEO Bob Pragada highlighted the crucial role Jacobs plays in this process. Due to the specialized nature of these projects and limited competition, Jacobs has positioned itself to command premium pricing for its services.
Furthermore, Jacobs’ ability to secure repeat business from clients like Lilly during expansion phases bodes well for future growth. As demand for GLP-1 medications continues to rise, Jacobs could stand to benefit from additional projects in regions like Asia and Europe.
From a valuation standpoint, Jacobs currently trades at a discounted forward P/E multiple of 16.1, offering investors an attractive entry point. While the company may not be in the business of selling medications or AI software, its involvement in cutting-edge industries like AI and electric vehicle production presents significant growth opportunities.
In conclusion, Jacobs Solutions presents a compelling investment case, fueled by strong secular trends, a competitive edge, and reasonable valuation. By recognizing the hidden potential in industries like infrastructure and advanced facilities, savvy investors can position themselves for long-term success.
So, if you’re looking to capitalize on the next big trend in healthcare and technology, consider adding Jacobs Solutions to your investment portfolio. With a track record of success and a clear strategy for growth, this under-the-radar stock could be the key to unlocking substantial returns in the years to come.