Jones Lang LaSalle Incorporated (JLL): what the price requires

At today's price, Jones Lang LaSalle Incorporated (JLL) is priced for today's economics sustained for ~5.2 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/JLL

Headline

FieldValue
TickerJLL
CompanyJones Lang LaSalle Incorporated
Current price$321.62/sh
CompositionReal Estate Management Services 77% / Leasing Advisory 12% / Capital Markets Services 9% / Investment Management 2% / Software and Technology Solutions 1%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Operating margin needed1.4%
Operating margin today3.2%
Margin compression implied-1.8pp
Must persist for5.2y
Multiple paid22x operating income

The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.

Solve inputs: computed at a 10.2% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.7 years.

How unusual the bet is: elevated

ReferenceValue
vs own history+0.39σ
cohort percentile (of 82 peers)34
sustained it ~5.2 years at this level29%
implied end-window share0%

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.39x5expensive
Earnings1.45x5expensive
Relative0.56x4justifies
Growth0.77x3justifies

Families that justify the price: Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.7%); the inversion above states its own rate.

Per-Model Detail (n=17)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$627.670.51xyesFCF base $1.3B, growth 11% (input: historical growth), terminal g 4.0%, WACC 8.7%, 6yr projection
DCF Exit MultipleGrowth$415.980.77xyesExit EV/EBITDA: 9.7x / 11.7x / 13.7x (bear / base = today's held flat / bull), 6yr
Relative ValuationRelative$572.660.56xyesP/E 26.88x (blended: static sector reference 35x + trailing (TTM) 15x), scenarios: 22.3x / 26.9x / 31.4x (bear / base = reference held flat / bull), EV/EBITDA 20x
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$202.191.59xyesBV/sh $152.86, ROE (TTM) 12.2%, ke 9.3%
Two-Stage Excess ReturnAsset$231.021.39xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$266.611.21xyesRev $26.8B, growth 11% (input: historical growth; tapered), Terminal P/S: 0.5x / 0.6x / 0.7x (bear / base = today's held flat / bull, cap 8x)
Growth-Adjusted P/ERelative——no—
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$138.112.33xyesNormalized EBIT (5y avg op income, one-time charges added back) $0.92B × (1−19%) / WACC 8.7% → EPV (no growth)
Residual IncomeAsset$236.931.36xyesBV $152.86 + 5yr PV of (ROE (TTM) 12.2% − Kₑ 9.3%) × BV; BV grows 8.0%/yr
Graham NumberAsset$274.201.17xyes√(22.5 × FFO/share $21.86 × BVPS $152.86) — Graham's conservative floor
EV/EBITDA RelativeRelative$568.740.57xyesEBITDA $1.42B × sector EV/EBITDA 20.0x
FCF YieldEarnings$246.861.30xyesFCF $1206.7M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings$221.641.45xyesSBC-adj FCF $1.10B (FCF $1.21B − SBC $0.11B) capitalized at Kₑ
Ben Graham FormulaEarnings$87.023.70xyesFFO/share $21.86 × (8.5 + 2×-1.9%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset$33.799.52xyesBV $152.86 × (ROIC 1.9% / WACC 8.7%)
P/Sales SectorRelative$3358.320.10xyesRevenue $26.76B × sector P/S 6.0x
PEG Fair ValueRelative——no—
Earnings YieldEarnings$236.321.36xyesFFO/share $21.86 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative$309.921.04xyesFFO/share $21.86 × 14.2x P/FFO (route cohort median, n=85); FFO $1.04B (FFO incl. D&A + impairments, FY2025, companyfacts), shares 48M
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt$1.5b
Net debt / NOPAT (after-tax)2.30x
Net debt / operating income (pre-tax)1.86x
Share count CAGR (buyback)-1.6%
Burning cashno

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

Bull Case

Read the balance sheet first, because it tells you how management feels about its own cycle. JLL carries net debt of roughly $1.5B against trailing operating income near $1.2B, leverage of about 1.25 times operating income, which is modest for a business with this much contracted, recurring management revenue underneath the transactional swings. The share count has been falling about 1.6% a year, which means even through a soft commercial real estate stretch the company kept buying back stock rather than hoarding cash or raising it. A management team that deleverages quietly and repurchases shares into a downturn is signaling confidence that the transaction engine comes back, and the most recent quarter says it has.

The model itself is built to absorb the cycle. Underneath the headline-grabbing capital markets and leasing fees sits a large annuity base: the company earns management and professional-services revenue "commensurate with the length and terms of the contract" and recognizes professional-services revenue as performance obligations are satisfied, which is the recurring spine that funds the firm when deal volumes are low. JLL splits its world into Advisory revenue, the transactional and cyclical part, and Resilient revenue, the contracted management part, and in the first quarter Resilient revenue grew 7% in local currency while Advisory grew 17%. The resilient base grows steadily; the advisory layer provides the torque.

That torque just showed up in full force. First-quarter revenue rose 11% to $6.4B, with Leasing Advisory up 16% in local currency, led by US office and accelerating industrial, and Capital Markets up 21% across investment sales, debt, and equity. Adjusted diluted EPS of $3.43 beat estimates of $3.03, and the operating leverage is the point: when transaction volumes recover, the incremental fee revenue drops to the bottom line at high margins because the cost base is already in place. A firm with a stable annuity floor and a recovering high-margin transaction layer, repurchasing its own stock through the trough, is positioned for the part of the cycle it appears to be entering.

Bear Case

The structural truth a holder should sit with is that a large share of JLL's profit comes from transactions that may not happen. This is not a steady fee machine wearing a cyclical costume; the company says so itself. Its capital markets and advisory revenues, including investment sales, debt and equity advisory fees, and incentive fees, "increase the variability of the revenue we earn", and that variability cuts both ways. The first quarter's 21% capital markets growth is the cycle turning up. The same line item fell just as sharply when deals dried up, and nothing about the business model prevents that from recurring the moment rates back up or credit tightens.

The demand backdrop is structurally unsettled, not merely cyclical. The company acknowledges that the evolution of corporate workplace strategies "continues to alter how companies use real estate, impacting demand across asset types, particularly the office sector". Office leasing led the recent recovery, but the long-run question of how much office space corporations actually need has not been resolved, only deferred. JLL is a leveraged bet on transaction volumes in an asset class whose largest category is still working out its post-pandemic equilibrium, and management's own guidance hangs a caveat on the year, citing prolonged Middle East tensions as a potential drag on the global economy in the second half.

Then there is what the price asks of a cyclical at what looks like an up-cycle moment. At roughly 20 times company-wide operating income, the market is pricing in something close to 22% annual operating growth sustained for five years. The near-term pace is within what JLL has recently delivered, but the demand is on duration, and only about a third of comparable fast-growers have sustained that kind of pace for five years. The trailing operating margin sits near 4.4%, thin by design for a services intermediary, which means small swings in revenue mix produce large swings in profit. Pay this multiple at this point in the cycle and the bet is that the transaction recovery is durable rather than a snap-back to a level that fades.

Valuation

The price is making a growth bet on a cyclical business, which is the tension to hold throughout. At about 20 times company-wide operating income, the market is asking JLL to compound operating profit roughly 22% a year for five years. The rate is within reach given the recovery underway; the stretch is whether it persists, and history says only about a third of comparable fast-growers held that pace for five years. The thin trailing operating margin near 4.4% is normal for a real estate services intermediary, where the firm takes a slice of large transaction values rather than owning the assets.

The methods divide cleanly. Relative-multiple and growth-DCF approaches land at or above the price, which is why the price reads as justified on a cyclical-recovery basis; the asset-value and several earnings-power methods land below it. The earnings-power lens that strips out growth, valuing the business on its zero-growth profit, sits well under the price, which is the mathematical statement of the cyclical setup: capitalize today's recovering earnings as if they were permanent and the number looks rich, credit the growth and it looks fair. No family flags the price as outright expensive, but the pattern says the defense rests almost entirely on the recovery continuing, not on the static value of current earnings.

On solvency, the picture is comfortable rather than fortress-like. Net debt of about $1.5B is roughly 1.25 times trailing operating income, the share count is shrinking, and the contracted management base provides cash-flow stability when transactions slow. One note on the numbers: the operating income that anchors the priced-in math and the figure read from the most recent quarterly filings differ by more than ten percent, a reminder that this is a business measured across a moving cycle, where the trailing window you pick materially changes the multiple.

Catalysts

The first-quarter print was the catalyst that mattered. JLL reported revenue of $6.4B, up 11% in USD, with diluted EPS of $3.33 and adjusted diluted EPS of $3.43, up 48% in USD, beating the $3.03 consensus. The recovery was broad: Leasing Advisory up 16% in local currency on US office strength and accelerating industrial, Capital Markets up 21% across investment sales, debt, and equity, and Real Estate Management Services up 7% on Workplace and Project Management.

For the rest of 2026 management expects high single-digit revenue growth in Leasing Advisory and low double-digit growth in Capital Markets, while explicitly building potential macroeconomic headwinds from prolonged Middle East tensions into its second-half framework. The near-term watch items are whether deal momentum in capital markets holds as the year progresses and whether office leasing keeps recovering, since both are the high-margin levers that drove the quarter. Longer term, management is leaning on its Accelerate 2030 strategy and its data and AI investments to scale the core services, a margin story that will take several prints to show up in the numbers.

Peer Cohorts (Per Segment, With Filing Citations)

Real Estate Management Services (reported)

Leasing Advisory (reported)

Capital Markets Services (reported)

Investment Management (reported)

Software and Technology Solutions (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Q1 2026 earnings release · Q1 2026 earnings release, April 30 2026 · Q1 2026 earnings call

View the full interactive JLL report on boothcheck