Market uncertainty has soared in recent weeks. Rising tariff rates have led to a pullback in global trade. Over the long-term, the plan is to restructure the global economy to include more domestic manufacturing.
Domestic manufacturing will require significant infrastructure spending. That’s already underway as some chipmakers have moved to produce their chips domestically. But there’s more plans underway, and many companies have already made billions in commitments that will take years to play out.
That’s why engineering companies like Jacobs (J) could be a buy here. The company has billions of dollars in backlogged projects, representing years of revenues.
Yet, the company has been caught up in the recent market downturn, with shares now near the low end of their 52-week range. Jacobs has been a steady player, with revenues up 4% in the past year, and with shares now trading at 19 times forward earnings.
Action to take: Long-term investors may like Jacobs shares here, given the potential for a continued buildout of infrastructure spending in the years ahead.
At current prices, Jacobs also pays a 1.1% dividend, which the company has a history of increasing over time.
For traders, shares are trending lower right now on market fears, which will fade in time. The October $130 calls, last trading for about $5.80, could see mid-double-digit returns in the months ahead.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.