UPDATE: Stifel Nicolaus Raises PT to $59 on Jacobs Engineering Group; Low Cost Labor Leverage

Stifel Nicolaus raises its price target from $55 to $59 on Buy-rated Jacobs Engineering Group

as the company sees higher margins on lower-cost North America outsourcing. Stifel Nicolaus comments, "We attribute the higher domestic margins to the fact that JEC is better able to outsource more work to the company's low cost labor centers for projects in the U.S. and Canada and less so for international projects where “localization” initiatives are required. So we view the shift toward more N. American activity as a positive for JEC stock. Issues in the quarter included higher than expected SG&A levels as the company experienced delays in utilizing recently hired labor." JEC closed at $41.86 on Tuesday.