Jones Lang LaSalle Incorporated (NYSE: JLL) — Resilient on Paper, Cyclical in Profit

Independent fundamental research. Report date: 2026-07-25. Price reference: $325.45 (NYSE close, 2026-07-24).

⚡ Claude’s Take

This block is the author’s own subjective opinion. It is general information, not investment advice, and is not a recommendation to buy or sell any security. The analysis that follows (Sections 1–15) deliberately takes no position, names no price target, and carries no buy/sell conclusion — that discipline is intact everywhere except inside this fenced block.

Verdict: HOLD — a fairly-priced, better-than-you-think capital allocator in a business that is more cyclical than it advertises. Accumulate on weakness toward the high-$200s; scale in hard only below ~$260. Not a short. Directional fair-value zone ≈ $300–365 (≈14–16× normalized adjusted EPS of roughly $21–23, or ≈9.5–11× EV/adjusted EBITDA on a $1.55–1.65B base). At $325.45 the stock sits squarely in the middle of that zone. There is no margin of safety here — only a fair price for a decent business.

The single most useful thing to know about JLL is that its headline resilience is an accounting illusion. Management defines “Resilient” revenue as 79% of the top line. But $17.16B of JLL’s $26.12B of FY2025 revenue is client-reimbursed pass-through cost. Strip it, and Resilient is 38.9% of the ~$8.96B of fee revenue JLL actually keeps — while Leasing Advisory and Capital Markets, the two purely transactional segments, are 65.1% of segment adjusted EBITDA. On the money that matters, this is a more transaction-levered business than CBRE (where the cyclical Advisory pool is ~47% of segment profit). That reframing cuts both ways: it means the current record earnings are more cycle-dependent than the narrative implies, and it means the operating leverage is real when volumes rise. What it does not support is paying a compounder multiple.

Against that, three genuine positives the market is under-weighting. First, capital allocation is materially better than the peer group. JLL spent $27.3M on acquisitions in FY25 and $69.7M in FY24; CBRE spent $1.5B and $1.2B. The direct consequence is that JLL earns 9.4% ROIC versus CBRE’s 6.0% on comparable ROE — and has positive tangible equity while CBRE’s is negative. The Board just raised the buyback authorization 275% to $3.0B, ~20% of the market cap, and Q1-26 already retired ~2% of shares at ~$301. Second, earnings quality is clean: adjusted EPS of $18.80 is only 14.6% above GAAP $16.40, versus a 66% gap at CBRE, because JLL does not add back acquisition-intangible amortization. Third, the valuation gap is extreme — 17.5× trailing GAAP earnings (46.7th percentile of JLL’s own decade) versus CBRE’s 31.9× (73.6th percentile). A 45% discount to a peer that earns two-thirds of your return on capital is hard to justify on fundamentals; it is justified by narrative — CBRE owns the data-center story, JLL does not.

Framing: a recovered cyclical at fair value with a live rate headwind — not a falling knife, not a momentum melt-up. The factor model is unambiguous: Momentum beta is negative (−0.13 to −0.24), interest-rate beta is strongly negative (−0.55 to −0.73) with the rate factor running a +1.9 twenty-one-day z-score, Quality loading is ~zero, and the three-year record is +24.3%/yr annualized with the stock 9.3% off an all-time high. This is a high-beta rate proxy that has already recovered most of the February AI-scare purge. Conviction: medium. Bullish trigger: two consecutive quarters of double-digit Capital Markets and Leasing fee-revenue growth against the hard 2H-2025 comparables, plus visible progress on LaSalle AUM — proving the cycle has runway rather than a peak. Bearish trigger: Value & Risk Advisory revenue rolling over, or a 2H-2026 miss that reveals FY25–26 free cash flow was peak-cycle rather than mid-cycle. Tag: “The cheaper twin — and the one that didn’t buy its growth.”

Timing note: JLL reports Q2-2026 on 2026-07-30, five days after this report date. This analysis is struck on information through Q1-2026.

📈 Stock Price Action — Five-Year Event Map

Factual price history, not a recommendation. Price moves are FACT (AZI five-year daily series); attributed drivers are INTERPRETATION.

The arc. JLL round-tripped a full commercial-real-estate cycle and then made a new high. From $142.33 (Jan-2021) it climbed to $272.88 (29-Dec-2021) on the post-COVID transaction boom, collapsed −55% to a $121.97 trough (25-Oct-2023) as the Fed’s hiking cycle froze deal-making, then more than tripled into an all-time high of $358.66 (29-Jan-2026). It has since given back part of that in two shocks — a February AI-disruption purge and a May rate relapse — to close at $325.45 on 24-Jul-2026, −9.3% off the all-time high, inside a 52-week range of $262.66–$358.66.

Cycle narrative. (1–3) The 2021 boom and the 2022–23 collapse are textbook CRE-services beta: transaction commissions — JLL’s largest profit pool — evaporate when the cost of capital spikes, and the multiple compresses simultaneously. GAAP diluted EPS fell from $18.47 (2021) to $4.67 (2023), a 75% earnings drawdown against a 55% price drawdown. (4–5) The recovery stacked a genuine volume thaw on top of real platform leverage: FY25 revenue +11%, adjusted EBITDA +22%, adjusted EPS +33% — profit growing three times revenue. (6) On 11 February 2026 the sector was repriced in a single session on fears that new AI applications disintermediate “high-fee, labor-intensive business models”; CBRE and Cushman & Wakefield had their worst days since the COVID crash, and JLL fell a further 7.6% the next day. (7) One week later the FY25 print — Q4 adjusted EPS +40% — reversed nearly half of it in a day, which is itself evidence that the February move was multiple, not fundamentals. (8) Since then the stock has traded rates: down 7.0% on 14 May as yields backed up, recovering into July. The stock has recovered the AI scare but not the January high.

1. Executive Summary

Jones Lang LaSalle is the world’s second-largest commercial real estate services and investment management firm: FY2025 revenue $26.12B (+11%), 113,200 employees, operations in 80+ countries, roots traceable to 1783. It reports four segments from January 2026 — Real Estate Management Services (workplace/facilities, project and property management, plus the software business), Leasing Advisory, Capital Markets Services, and Investment Management (LaSalle, $86.4B AUM).

The central analytical move is to read JLL on fee revenue, not gross revenue. $17.16B — 65.7% of the reported top line — is client-reimbursed pass-through cost booked gross. Fee revenue is therefore ~$8.96B. This inverts the segment picture entirely: Real Estate Management Services is 76.6% of gross revenue but only 32.4% of fee revenue; Leasing Advisory is 11.5% of gross but 33.5% of fee revenue. Management’s “Resilient” revenue category covers 79.0% of gross revenue but only 38.9% of fee revenue, and the two transactional segments generate 65.1% of segment adjusted EBITDA. JLL is a more cyclical business at the profit line than its own disclosure framing suggests — and more cyclical than CBRE, whose transactional Advisory pool is roughly 47% of segment operating profit.

The moat is real but narrow, and in Greenwald’s taxonomy it is customer captivity plus economies of scale, confined almost entirely to the Workplace Management and Project Management contracts inside Real Estate Management Services — multi-year mandates (3–7 years), high renewal rates, many of the largest in place over a decade, with a six-to-twelve-month practical switching cost even where contracts are terminable on short notice. Leasing and Capital Markets have neither: producers are portable and every mandate is re-bid. The disconfirming evidence is in the returns — ROIC has averaged ~8.9% across 2018–2025 (9.4% in FY25) against a plausible 9–10% WACC. That is scale without pricing power, and fee-revenue EBITDA margins of 15–19% across every segment are its fingerprint.

Financial quality is good and improving, and earnings quality is genuinely clean. FY25 GAAP operating income $1,098.0M (+26%), adjusted EBITDA $1,452.9M (+22%), GAAP diluted EPS $16.40 (+44%), adjusted diluted EPS $18.80 (+33%). The adjusted-to-GAAP gap is only 14.6% — versus 66% at CBRE — because JLL does not add back acquisition-intangible amortization. Operating cash flow was $1,194.1M and free cash flow $978.5M; but free cash flow is volatile and working-capital-driven (it was negative $5.9M in FY22). The balance sheet is conservative: net debt $1,049.9M, reported net leverage 1.0× at the seasonal peak, zero drawn on a $3.3B revolver and zero commercial paper outstanding, and positive tangible equity of ~$2.13B.

Capital allocation is the strongest part of the story and the clearest differentiator. JLL has effectively stopped buying growth — $27.3M of acquisition spend in FY25, $69.7M in FY24 — while CBRE spent $2.7B across the same two years. The arithmetic consequence is JLL’s ~1.6× ROIC advantage. In March 2026 the Board added $2.2B to the repurchase program, taking it to $3.0B (~20% of market cap); $300M was deployed in Q1-26 at an average ~$301, retiring ~2% of shares. Share count is down 9.2% over five years. The blemishes: no ROIC or return-on-capital metric anywhere in the incentive plan (Adjusted EPS carries 75% of the PSU weight, which a $3B buyback mechanically inflates), and zero insider open-market purchases across the trailing 25 months of Form 4s, with the CEO selling 30,000 shares into the November–December 2025 high under a 10b5-1 plan.

On valuation, JLL trades at 17.5× trailing GAAP earnings — the 46.7th percentile of its own decade — and 14.4× the midpoint of FY2026 adjusted EPS guidance of $21.80–23.50, versus CBRE at 31.9× and the 73.6th percentile. EV/FY26 guided adjusted EBITDA is ~9.9×. The embedded expectation is roughly 3.0–4.6% perpetual free-cash-flow growth at a 9–10% WACC — undemanding if current cash flow is mid-cycle. Global transaction volumes are still ~30% below the 2021 peak, which supports the mid-cycle reading; JLL’s own earnings are at records, which does not. That single unresolved question — mid-cycle or peak-cycle — is the whole valuation.

2. Business Overview

JLL was incorporated in Maryland in 1997 and listed on the NYSE; its operating heritage runs to Jones Lang Wootton (England, 1783) and LaSalle Partners (United States, 1968), combined in the 1999 merger that created the modern firm. Headquarters are at 200 East Randolph Drive, Chicago. It is a Fortune 500 company, ranked #175 in 2026 (up from #188).

2.1 What the company actually sells

JLL monetizes the built environment through four channels that span the full cyclicality spectrum, from multi-year contracted facilities annuities to pure transaction commissions to principal fund management.

Real Estate Management Services — $20,001.2M gross revenue, $2,899.2M fee revenue, $437.5M adjusted EBITDA. The occupier-outsourcing engine, comprising five business lines from 2026:

• Workplace Management ($13,848.5M gross, +11%) — comprehensive facilities management for corporations and institutions that outsource the real estate they occupy, typically portfolios above one million square feet. ~2.8 billion square feet under management. Contracts run three to seven years, generally on a principal basis (fixed fee, guaranteed maximum, or reimbursement-based) with a base fee plus performance-based fees. Most clients renew at least once; many of the largest mandates have been in place more than a decade. This is where the reimbursable-cost gross-up lives.
• Project Management ($3,797.9M gross, +20% — the fastest-growing line) — consulting, design, management and build services, delivered under the JLL brand and, in Europe, the Tétris brand. Individual projects generally complete inside a year; client contracts can span multiple years. FY25 growth was broad-based across geographies; Q1-26 growth was led by the Americas, “including from new data center wins.”
• Property Management ($1,841.3M gross, +3%) — services to property owners rather than occupiers. ~2.9 billion square feet. Contracts are shorter (one to three years) and terminable on 30–120 days’ notice. This line is currently being actively pruned (see Section 8).
• Portfolio Services and Other ($513.5M, flat) — occupancy planning, location advisory, lease administration, transaction management. Transactional in character.
• Software and Technology Solutions ($232.3M, +3%) — JLL Azara, JLL Falcon, JLL GPT, LeasingOS and related products. Loss-making at −$14.2M adjusted EBITDA in FY25, improved from −$19.6M.

Leasing Advisory — $3,009.9M gross, $2,998.3M fee revenue, $580.1M adjusted EBITDA. Agency leasing (representing landlords) and tenant representation (representing occupiers), plus a small advisory/consulting line. In 2025 JLL completed ~19,500 agency leasing transactions covering 340 million square feet and ~23,500 tenant-representation transactions covering 569 million square feet. Fees are typically a percentage of the lease revenue commitment. Almost no pass-through cost — gross revenue ≈ fee revenue — which is why this segment is 11.5% of gross revenue but 40.0% of segment profit.

Capital Markets Services — $2,422.1M gross, $2,416.4M fee revenue, $364.4M adjusted EBITDA. Three sub-lines with very different characters:

• Investment Sales, Debt/Equity Advisory and Other ($1,874.5M, +24%) — property sales brokerage, debt placement, equity and funds placement, M&A and corporate advisory. JLL executed ~$258 billion of client transactions in 2025. Purely transactional.
• Value and Risk Advisory ($379.6M, +2%) — valuation, appraisal, secured-lending advisory, property-tax advisory, restructuring. Contracted and recurring in JLL’s framing — and, as Section 3 argues, the line most exposed to automation.
• Loan Servicing ($168.0M, +4%) — JLL is a Freddie Mac, Fannie Mae and HUD/Ginnie Mae approved multifamily lender and one of only 24 Fannie Mae DUS lenders, servicing a $140.3 billion loan portfolio. Genuinely annuity-like, and the licence is a real regulatory barrier.

Investment Management (LaSalle) — $450.1M gross, $414.0M fee revenue, $83.5M adjusted EBITDA. Founded 1979; $86.4B AUM at year-end 2025, across open- and closed-end commingled funds, separate accounts, joint ventures and listed real-estate securities, invested in 24 countries. JLL co-invests $505.8M alongside clients. Revenue splits into advisory fees ($373.7M, flat), transaction fees ($37.3M) and incentive fees ($39.1M, −35%).

2.2 Revenue mechanics — why the gross/fee distinction is everything

Fee revenue is derived as reported revenue less disclosed gross contract costs; JLL does not publish a fee-revenue line. Segment adjusted EBITDA sums to $1,451.3M against a consolidated $1,452.9M; the residual sits in “All Other.”

The table is the analytical heart of this memo. Read the first column and JLL looks like a facilities-management annuity with a brokerage attached. Read the third and fourth and it is a brokerage with a facilities-management annuity attached. Gross contract costs “represent certain costs associated with client-dedicated employees and third-party vendors and subcontractors and are directly or indirectly reimbursed through the fees we receive” — they are cost recovery, not economic revenue, and 54,600 of JLL’s 113,200 employees are directly reimbursable.

Applying the same lens to management’s own Resilient/Advisory taxonomy: Resilient revenue is $20,641.3M = 79.0% of gross revenue, but only $3,483.1M = 38.9% of fee revenue.

2.3 Geography and currency

62.4% of FY25 revenue was earned in US dollars, with British pound 7.5%, euro 6.4%, Australian dollar 4.4%, Indian rupee 3.5%, Canadian dollar 2.4%, Hong Kong dollar 2.2%, Chinese yuan 2.0%. Roughly 38% of revenue originates outside the United States, and two-thirds of employees are based outside it. JLL partially hedges through local-currency invoicing and regional hubs in London and Singapore; it held cross-currency swaps of $805.8M notional and forwards of $2.04B at year-end. Sensitivity is modest: a 10% stronger pound would have added $11.8M to FY25 operating income; a 10% stronger euro, $7.4M.

Verdict: a genuinely global, genuinely diversified services platform — but one whose reported revenue scale (a Fortune 500 rank of #175 on $26.1B) materially overstates its economic scale. On the ~$9.0B it actually keeps, JLL is roughly a third the size its headline implies, and the majority of that fee revenue and profit sits in the two most cyclical lines it operates.

3. Industry Dynamics

3.1 Structure

Commercial real estate services is a scale-tiered global oligopoly sitting on a long fragmented tail. By FY2025 revenue: CBRE ~$40.6B > JLL $26.1B > Cushman & Wakefield ~$10B > Colliers ~$5.6B > Newmark ~$3.5B, beneath which sit thousands of regional and local brokerages, facilities-management specialists, and in-house corporate real-estate teams. The “big three” dominate large multinational occupier mandates and institutional capital-markets assignments, where global coverage, integrated service breadth and proprietary data are genuine entry barriers. Below that tier — local leasing, single-market property management, regional valuation — the industry is highly competitive and barriers are close to nil.

JLL’s own 10-K competition language is unusually candid about the threat set: it names not only traditional rivals but “investment banking firms, investment managers, accounting firms, technology firms, software-as-a-service companies, firms providing co-working space, firms providing outsourcing services of various types… and companies that self-perform their real estate services with in-house capabilities.” The last clause matters — the outsourcing thesis that underpins Real Estate Management Services is a choice clients can reverse.

3.2 Profit pools and cyclicality

The industry bifurcates cleanly:

• Transaction pools — leasing commissions, investment-sales brokerage, debt placement, mortgage origination — are deeply rate-sensitive, recognized at close, and can halve in a hiking cycle. Global CRE investment volume peaked near $1.3 trillion in 2021, fell roughly a third into the 2022H2–2023 trough as bid-ask spreads froze, and has been recovering since.
• Recurring pools — facilities and property management, loan servicing, contracted valuation, investment-management fees — are structurally steadier and grew through the downturn.

This split is the defining feature of the industry, and it is precisely why the fee-revenue lens matters: the recurring pools carry most of the revenue dollars but a minority of the profit dollars, because their margins are thin and their revenue is grossed up by reimbursables.

3.3 Where we are in the cycle

The recovery is real and still running. Global direct transaction volumes rose 19% in 2025 and a further 18% year-over-year in Q1-2026 to $216 billion; US volume reached $113 billion in Q1-2026, +25%, with US office investment +61%. Global office leasing hit its highest level since the pandemic in 2025. Cross-border investment finished 2025 up 25%.

But volumes remain roughly 30% below the 2021 peak. This is the crux of the cycle debate and it cuts genuinely both ways:

• Mid-cycle reading (bull): if the industry’s transaction pool is still a third below its prior peak, JLL’s record earnings are being generated on a depressed volume base, and there is substantial operating leverage left. Management’s Q1-26 language — “meaningful runway for continued growth over the long term” — takes this view.
• Peak-cycle reading (bear): JLL’s earnings are at all-time records regardless of where volumes sit, because margin expansion and share count reduction have amplified each volume dollar. Seven consecutive quarters of double-digit revenue growth, two-year stacked growth of 42% in investment sales and 81% in debt advisory, and Q1-26 Capital Markets adjusted EBITDA +63% are not the arithmetic of an early cycle. And the 2H-2026 comparables are the hardest of the recovery.

Both readings are defensible from the same data. The Q2-2026 print (30 July 2026) and the 2H comparables are the near-term arbiter.

3.4 The AI question — the defining sector issue of 2026

On 11 February 2026, CBRE and JLL fell ~12% and Cushman & Wakefield ~14% in a single session — for CBRE and CWK the worst day since the COVID crash — as investors rotated out of what analysts described as “high-fee, labor-intensive business models” seen as vulnerable to a new generation of AI applications. JLL fell a further 7.6% the next day. Rising Treasury yields compounded the move.

Management’s rebuttal, on the 30 April 2026 call, rests on three claims (all management hypothesis, not verified evidence):

1. Proprietary data as the moat. Ulbrich: “we have by far the best data platform within our industry… that data platform is growing with every transaction we are doing.” The claim is that AI raises the value of proprietary, permissioned transaction data rather than commoditizing the advice built on it.
2. AI as an internal productivity tailwind. Howe cited 75% adoption across core enablement products and 25,000 employees using enterprise AI applications daily, +60% year-over-year. Named assets: JLL Falcon (the foundational platform), JLL GPT, JLL Azara, LeasingOS.
3. AI as a demand tailwind. Howe: “the AI boom has actually been also a boom for our leasing business as the ecosystems around all of the AI start-ups… has really caused an uptick in activity, particularly on the coast, San Francisco, New York.” Q1-26 Project Management growth included “new data center wins.” JLL’s own July-2026 research argues that the US markets most exposed to AI-driven job displacement are simultaneously seeing the strongest AI-company real-estate demand.

Assessment (INTERPRETATION). The rebuttal is directionally credible where the work is relationship-intensive and information-asymmetric — investment sales, tenant representation, complex debt structuring. It is weakest precisely where Ulbrich claims brand protection: Value and Risk Advisory — appraisal and valuation, $379.6M of FY25 revenue — is the most rules-based, most data-driven, most automatable line JLL runs. Ulbrich’s defence reduces to “there’s also a very important aspect who is confirming the potential valuation where the brand aspect is absolutely significant.” That is an assertion about client conservatism, not a structural barrier; regulatory sign-off requirements are a real but erodible one. Value & Risk Advisory revenue growth of +2% in FY25 and +9% in Q1-26 gives no evidence of impairment yet — and that line item is the single cleanest falsification test available (see Section 14).

The broader point is that the February selloff repriced a multiple, not a forecast: one week later a strong FY25 print reversed nearly half of it in one session. Whether AI is a five-year threat to a $379.6M revenue line or a fifteen-year threat to the whole intermediation model is genuinely unresolved, and no amount of management confidence resolves it.

3.5 Marathon capital-cycle read

Supply-side dynamics are favourable for incumbents in the core business. Brokerage is a talent-cost business with no asset build; capital is not flooding in, no greenfield capacity is being constructed, and the 2022–23 downturn drove consolidation rather than expansion. Trailing transactional earnings therefore understate mid-cycle earning power — the classic Marathon setup.

Capital is flooding into two adjacent places, and both matter: data-centre development and services/engineering roll-ups, where deal multiples have risen materially. This creates an overpaying-for-growth risk for anyone acquiring into those areas. It is a risk JLL has so far conspicuously declined to take — Ulbrich in Q1-26: “we are very confident that our organic growth rate will stay at the high single-digit level. And so there is no need to do any M&A.” Whether that restraint survives the “nervousness on the seller side with regards to the price levels they can achieve” that he simultaneously flagged is the thing to watch.

3.6 Investment Management: sub-scale in a scale business

LaSalle’s $86.4B AUM fell 3% in 2025 — $5.9B of acquisitions against $8.7B of dispositions and withdrawals, i.e. negative net flows, partly offset by $1.8B of valuation gains. It recovered to $86.9B by Q1-26 (+6% year-over-year in USD). Against CBRE Investment Management’s $155.5B, LaSalle is sub-scale in an industry where scale drives fee rates, distribution and cost absorption. It is 4.6% of fee revenue and 5.8% of segment profit, and JLL is now committing balance-sheet capital ($100M into JLL Income Property Trust in January 2025, €100M into LaSalle Encore+ announced April 2026) specifically to jump-start fundraising.

Verdict: a structurally AVERAGE industry (B/B−). Barriers are moderate and concentrated in the outsourcing/servicing layer; the transaction layer has essentially none beyond relationships and brand. Supply-side discipline is genuinely favourable. But the durable economics live in the smaller, thinner-margin recurring pools, not in the cyclical brokerage that generates two-thirds of the profit. This is not a structurally high-return industry, and JLL’s ~8.9% eight-year average ROIC is the proof.

4. Competitive Position

4.1 Naming the moat

In Greenwald’s taxonomy the genuine advantage types are supply-side cost advantage, demand-side customer captivity, and economies of scale reinforced by captivity. JLL has the third — economies of scale plus customer captivity — but only inside Workplace Management and Project Management. Each claimed advantage is tied below to a financial outcome that would deteriorate without it.

Advantage 1 — Customer captivity in Workplace Management (the real moat). Once JLL runs a multinational’s global facilities estate — embedded in their operations, systems, vendor relationships and data — replacement is disruptive and expensive. Financial fingerprint: contracts run three to seven years; JLL reports “a high renewal rate, with most clients renewing their contracts at least once; many of our largest contracts have been in place for more than a decade”; and although most are terminable on 30–60 days’ notice, “a transition period of six to twelve-months is more common in our industry.” Workplace Management revenue grew +11% in FY25 and +8% in Q1-26 on “a largely balanced mix of mandate expansions and new client wins.” Critically, this book grew through the 2022–23 transaction recession, when Leasing and Capital Markets were collapsing. If these were commodity re-bid contracts, that would not have happened.

Advantage 2 — Economies of scale in coverage and data. ~2.8bn sq ft under Workplace Management, ~2.9bn under Property Management, ~43,000 leasing transactions and ~$258bn of capital-markets transactions annually, 80+ countries. This wins enterprise multi-line, multi-geography mandates that sub-scale rivals cannot service, and feeds a proprietary transaction dataset that JLL is now monetizing through Falcon/Azara/GPT. Financial fingerprint: market-share gains — FY25 investment-sales revenue +21% against a market up 18%; Q1-26 office leasing revenue +12% against global volumes down 1%, and US revenue +14% against US volumes +7%. That is genuine, quantified, repeated outperformance of the underlying market.

Advantage 3 — Regulatory licence in Loan Servicing (small but real). One of only 24 Fannie Mae DUS lenders, plus Freddie Mac and HUD/Ginnie Mae approval, servicing $140.3bn. This is a hard barrier — you cannot buy your way in quickly. But it is $168.0M of revenue, 1.9% of fee revenue.

Advantage 4 — Brand. Real, and JLL cites brand-perception surveys, trade recognition and long client tenure. But in this industry brand supports access to the bid, not price on the bid.

4.2 What is not a moat

Leasing Advisory and the transactional half of Capital Markets — 65.1% of segment profit — have no durable competitive advantage. Producers are portable and can leave with their client books (JLL’s own use of forgivable employee loans, with interest, “predominantly in Leasing Advisory and Capital Markets Services,” is a direct admission that retaining producers requires paying to lock them in). Every mandate is re-bid. Commission rates are set by market convention, not by JLL. The clearest internal evidence is the Q1-26 margin commentary: strong revenue growth reduced incremental leasing margins because “our producers have hit higher commission tiers earlier in the year than we expected” — i.e., a material share of the operating leverage from a good year flows to the brokers, not the shareholders. Management guided full-year Leasing margin “relatively flat versus prior year” despite high-single-digit revenue growth. That is the signature of a business with no pricing power over its own key input.

4.3 The returns test

The Greenwald share-stability and ROIC tests are the disconfirming evidence, and they should be stated plainly:

Eight-year average ROIC ~8.9%, against a WACC of roughly 9–10% (1.18 beta, ~4.5% risk-free, negligible net leverage). JLL has, across a full cycle, earned approximately its cost of capital and no more. A moat that cannot lift returns above the cost of capital across eight years is not producing a financial outcome that would deteriorate without it — except in one place: strip out the recurring outsourcing book and the cyclical remainder would be worse, not better. The moat is holding the floor, not raising the ceiling.

4.4 Versus peers — and the CBRE comparison specifically

The comparison is the single most useful frame in this memo. CBRE is the bigger, more diversified, more recurring business with the better narrative — and the worse capital allocation. Its returns collapsed from ~9.5% ROIC in 2021 to ~6.0% in 2025 while revenue grew 46%, because it kept buying. JLL’s returns went the other way over 2023–25 (6.5% → 9.4%) because it stopped. Cushman & Wakefield is more transaction-levered still and balance-sheet-constrained; Colliers has diversified hardest into higher-multiple engineering and investment management; Newmark is the smallest and most US-concentrated.

Verdict: a real but narrow moat, correctly located and honestly small. Customer captivity plus scale in the outsourcing book, a regulatory licence in loan servicing, and demonstrable market-share gains from the data platform — surrounded by a larger, low-moat, people-based transactional business that produces two-thirds of the profit. The through-cycle ROIC of ~8.9% is what that combination is worth. Anyone underwriting JLL as a quality compounder is underwriting the 35% of profit that has a moat and ignoring the 65% that does not.

5. Growth History and Forward Opportunities

5.1 The record

Note: the EBITDA figures for 2020–2023 are as computed by ROIC.ai from the statements; FY24 and FY25 Adjusted EBITDA are as reported by JLL. The trajectory, not the third decimal, is the point.

Three observations. First, revenue growth is heavily inflated by pass-throughs: gross contract costs grew 11% in FY25 and 12% in Real Estate Management Services, and a portion of Project Management’s headline +20% was explicitly “higher pass-through costs augment[ing] a low double-digit management fee increase.” Second, the growth is almost entirely organic — FY25 acquisition spend was $27.3M, and CFO Howe stated Q1-26 revenue growth “was almost entirely organic.” That is a genuine, and genuinely unusual, quality marker in this industry. Third, free cash flow has not compounded at all over five years: $965.3M in 2020, $978.5M in 2025, with a negative year in between. The earnings growth is real; the cash conversion is erratic.

5.2 Segment growth, FY2025 and Q1-2026

The pattern is stark and should temper any “resilience” enthusiasm: the transactional lines are growing at two to three times the resilient lines. Within the resilient book, Project Management is the only genuine growth engine; Property Management, Value & Risk, Loan Servicing, LaSalle advisory fees and Software are all growing at low single digits or shrinking. Q1-26 equity advisory grew “nearly 80%”; debt advisory +30% (81% two-year stacked); investment sales +27% (42% two-year stacked). The current earnings momentum is a transaction-cycle phenomenon.

5.3 Forward opportunities

1. Continued transaction recovery. Management targets low-double-digit Capital Markets revenue growth and high-single-digit Leasing revenue growth for FY2026, with mid-30s incremental margins in Capital Markets and flat Leasing margins. If volumes really are 30% below peak, the runway is multi-year.
2. Data centres and AI infrastructure. Present but under-quantified. JLL cites “new data center wins” driving Project Management, “a meaningful contribution from data centers” in Q1-26 leasing, and data-centre property types across the platform. JLL discloses no dollar figure for data-centre revenue — a striking omission given CBRE quantifies >$3B of infrastructure revenue and a $1.7B Critical Infrastructure Services line. This is a material disclosure gap and a plausible partial explanation for the valuation discount (see Section 13).
3. LaSalle re-scaling. The revamped Investment Management strategy, seeded by JLL’s own capital: $100M into JLL Income Property Trust (Jan-2025), €100M into LaSalle Encore+ (Apr-2026), and a new global decarbonization fund (Lp3F) launched with Shell, initial size ~$300M, targeting deep retrofits of vacant and underperforming buildings. Ulbrich’s logic: an anchor commitment from the manager “drives a lot of confidence into the product” and jump-starts third-party fundraising.
4. Outsourcing penetration. The structural driver of Workplace Management: corporates consolidating fragmented vendor rosters onto single global platforms. Management targets mid-to-high single-digit Real Estate Management Services revenue growth for FY26, second-half weighted, with a strong but back-loaded pipeline and stable renewal rates.
5. Accelerate 2030. The March 2026 framework: 8% annual revenue growth, 12% annual adjusted EBITDA growth, 16% annual adjusted EPS growth, on average through the cycle, with FCF conversion ≥80%.

5.4 Reading the Accelerate 2030 targets honestly

The four-point wedge between 12% EBITDA growth and 16% EPS growth is share count. At a $3.0B authorization against a ~$15B market cap, a sustained buyback of roughly 3–4% of shares per year is exactly what closes that gap. Roughly a quarter of the headline long-term EPS growth target is share-count arithmetic, not operating performance. That is not illegitimate — buybacks at sensible prices create value — but it should be labelled, especially given that Adjusted EPS carries 75% of the PSU weighting in management’s own long-term incentive plan.

The 8% revenue growth target also deserves scrutiny: on gross revenue it is partly a pass-through-growth target, since gross contract costs are 65.7% of the base and grow with outsourcing volume. The EBITDA target is the honest one.

Verdict: mixed-quality growth. The organic, un-acquired nature of it is a genuine positive and separates JLL from CBRE. The composition is not: the fast-growing lines are the cyclical ones, the resilient book outside Project Management is growing at low single digits, LaSalle had negative net flows, and the headline long-term EPS target leans on financial engineering for a quarter of its arithmetic. This is good cyclical growth being presented as secular growth.

6. Financial Quality

6.1 Margins and operating leverage

FY2025 delivered genuine operating leverage: revenue +11%, total platform operating expenses +8%, gross contract costs +11%, GAAP operating income +26%, adjusted EBITDA +22%. The gap between the 11% revenue increase and the 8% platform-cost increase is the leverage, and it is repeatable while volumes rise. Q1-2026 repeated it: revenue +9% LC, platform operating expenses +8%, operating income +76% LC, adjusted EBITDA +24% LC.

On fee revenue, consolidated adjusted EBITDA margin was 16.2% in FY2025 (up from ~14.6% implied in FY24). Segment fee-revenue margins: Investment Management 20.2%, Leasing Advisory 19.3%, Real Estate Management Services 15.1%, Capital Markets 15.1%, Software −6.2%. No segment earns more than ~20% on the revenue it keeps. That is the quantitative signature of scale without pricing power, and it holds even in the segments with the strongest competitive position.

FY25 profitability absorbed an approximately $25 million adverse impact from a US employee healthcare actuarial deficit (~$22M of it landing in Real Estate Management Services), which management says was “largely offset by discrete cost management actions.” Both the headwind and the offsets are one-time in character; whether either recurs in 2026 is not disclosed.

6.2 Quality of earnings — the cleanest thing about JLL

GAAP diluted EPS $16.40; adjusted diluted EPS $18.80 — a gap of only 14.6%. For comparison, CBRE’s Core EPS runs 66% above its GAAP EPS. The reason is structural and creditable: JLL does not add back acquisition-intangible amortization to adjusted earnings. Its intangible amortization is dominated by mortgage servicing rights ($458.2M of the $666.7M net intangible balance), which are a genuine economic cost of the loan-servicing business and are amortized through revenue.

Three caveats keep this from being a clean bill of health:

• Restructuring and acquisition charges are recurring in character. $75.3M in FY25 versus $23.1M in FY24 — a 226% increase — but the FY24 figure was flattered by a −$32.6M fair-value release on earn-out liabilities. On the underlying lines, severance and employment-related charges rose from $27.1M to $42.2M and restructuring/pre- and post-acquisition charges from $28.6M to $34.9M. A company that restructures every year is not restructuring; it is operating.
• Equity losses from Proptech are a real cost of a real decision. −$38.8M in FY25 and −$53.8M in FY24 from JLL Spark venture investments, excluded from adjusted results as “non-cash in nature.” The cash went out at some point; the write-downs are the return on it. Over two years that is $92.6M of value destroyed on venture bets and excluded from the metric management is paid on.
• Stock-based compensation of $114.7M is a real expense and is not added back to adjusted EBITDA — correct treatment — but it should be netted from free cash flow when computing owner earnings.

6.3 Cash flow — the weakest link

FY2025 was an excellent cash year — operating cash flow +52% — driven by higher cash earnings, the absence of a 2024 outflow relating to a loan repurchased from Fannie Mae (plus 2025 proceeds from selling that asset), and lower cash taxes. But the multi-year record is volatile and working-capital-driven: FY2022 free cash flow was negative $5.9M on a $770.4M working-capital swing. Net reimbursables — receivables from clients for pass-through costs already incurred — swing with the growth rate of the outsourcing book, so fast growth consumes cash. CFO Howe confirmed the mechanic in Q1-26: “Higher cash earnings were largely offset by growth-related working capital headwinds, particularly within net reimbursables.”

Management targets free cash flow conversion above 80% of adjusted net income for the full year and has embedded it as a long-term target and as 25% of the PSU weighting. Cumulative 2020–2025 free cash flow of $3,723.1M against cumulative adjusted net income over the same period suggests the target is achievable in good years and clearly was not met in 2022–2023. Treat it as an aspiration with an incentive attached, not a demonstrated capability.

Capital intensity is genuinely low: net capital additions of $215.6M are 2.4% of fee revenue and 0.8% of gross revenue, spent on office leasehold improvements, hardware and purchased/developed software. This is a capital-light business in the ways that matter.

6.4 Balance sheet

Debt structure is conservative and cheap: $400.0M of 6.875% senior notes due December 2028; €175.0M at 1.96% due June 2027; €175.0M at 2.21% due June 2029. The $3.30B revolver (matures November 2028) had zero drawn at year-end, and the $2.5B commercial paper program had zero outstanding. Average borrowings during FY25 were $1,119.7M at a 4.9% effective rate, improved from $1,381.4M at 5.9% in FY24 — which is why interest expense fell to $107.3M from $136.9M. A 50bp rise in rates would raise net interest expense by only $3.5M.

Reported net leverage was 1.0× adjusted EBITDA at 31 March 2026 — JLL’s seasonal peak — and improved year-over-year. Liquidity is ample. Off-balance-sheet commitments are modest: $203.5M of unfunded Investment Management commitments, $7.3M for Proptech, $75.5M of maximum undiscounted earn-outs across 11 acquisitions (only $17.2M accrued), and $21.3M of deferred acquisition obligations.

The one balance-sheet caution: goodwill of $4,707.3M is 63% of common equity and 2.2× tangible book. It has never been impaired, and JLL’s acquisition restraint means it is not growing quickly (+$96M in FY25, mostly currency). But it is the accumulated cost of two decades of consolidation, and it is why ROE (11.8%) flatters ROIC-on-tangible-capital in the other direction from CBRE — JLL’s reported ROIC of 9.4% is calculated on a base that includes it, so the operating business earns materially more than 9.4% on its actual working capital. That is the honest bull case on returns: the invested-capital denominator is largely a historical purchase price, not a required investment.

6.5 Tax and seasonality

Effective tax rate 19.3% (FY25) and 19.5% (FY24) — low, reflecting the geographic mix, with no repatriation of foreign earnings assumed. The One Big Beautiful Bill Act (enacted 4 July 2025) was immaterial to FY25; its international provisions are largely effective in 2026 and management again calls the impact immaterial. Seasonality is pronounced: Q1 is structurally the weakest quarter and Q4 the strongest, “a result of a general focus in the real estate industry on completing or documenting transactions by calendar year end,” with largely fixed non-variable operating expenses spread evenly.

Verdict: economics improve with scale, but only modestly, and the cash does not follow reliably. Operating leverage is demonstrable — 11% revenue producing 22% EBITDA growth in FY25, 9% producing 24% in Q1-26. Earnings quality is the best in the peer group. The balance sheet is genuinely conservative with positive tangible equity and untapped facilities. Against that: no segment earns above ~20% on fee revenue, free cash flow has not compounded in five years and went negative once, and returns on total invested capital have hovered at cost of capital across a full cycle. Good financial quality; not high financial quality.

7. Capital Allocation

7.1 The record, in one table

7.2 Buybacks — the dominant use of capital, and now the dominant story

JLL has repurchased $1,663.5M of stock since 2020, 45% of cumulative free cash flow, and pays no dividend (suspended in 2020, never reinstated). Share count is down 9.2% from 51.105M (2020) to 46.393M (record date, 2 April 2026).

The pace changed decisively in 2026. At the 12 March 2026 Investor Briefing the Board authorized an additional $2.2 billion, taking the total program to $3.0 billion — the largest in company history and approximately 20% of the current market capitalization. In Q1-2026 alone JLL repurchased $300M at an average of ~$301, including a $200M accelerated share repurchase executed at ~$290, retiring nearly 2% of shares in a quarter; $2.7B remained authorized.

Management’s stated approach (Howe, Q1-26): roughly $100M/quarter programmatic plus opportunistic tranches, with the annual total flexing on “the broader operating environment, our leverage outlook and valuation as well as relative returns to other investment opportunities inclusive of M&A.”

Assessment. The historical record is decent but not exceptional — the largest single year was 2022 ($688.4M), executed as the stock fell from ~$251 to ~$159, which is respectable counter-cyclical behaviour; but repurchases were then cut to $92.2M in 2023, the trough year with the stock at $122–190. JLL bought least when the stock was cheapest. The 2026 program is being executed at $290–301 against a $122 five-year low and a $358.66 all-time high. That is buying near the top of the range, not the bottom — defensible if the business is mid-cycle, expensive if it is not.

7.3 M&A — the strongest positive, by omission

JLL has essentially stopped acquiring. Total cash paid for business acquisitions was $27.3M in FY2025 and $69.7M in FY2024 — against CBRE’s $1,535M and $1,203M over the same two years. Payments relating to current-year acquisitions were $7.7M in 2025. Outstanding earn-out exposure is trivial: $17.2M accrued against a $75.5M undiscounted maximum across 11 deals.

This restraint is the single largest driver of the returns gap versus CBRE, and management is explicit about it. Ulbrich, Q1-26: “we are very confident that our organic growth rate will stay at the high single-digit level. And so there is no need to do any M&A.” He also flagged that “the M&A market overall has significantly increased in activity in our space” with “a little bit of nervousness on the seller side with regards to the price levels they can achieve” — i.e., he sees prices coming to him rather than chasing. Whether that discipline survives a competitor’s transformational deal is the open question, but the eight-year record supports the claim.

7.4 Principal capital — the newest and least-proven use

Three commitments in eighteen months mark a genuine strategic shift:

• $100.0M into JLL Income Property Trust (LaSalle’s US core open-end flagship), January 2025.
• €100M into LaSalle Encore+ (European core open-end flagship), announced 30 April 2026.
• A new global decarbonization fund (Lp3F) launched with Shell, first close in Q1-2026, initial size ~$300M, targeting deep retrofits of vacant buildings, light retrofits and ground-up development.

FY25 funding of investments exceeded returns of capital by $111.1M. Total investments carrying value is $892.9M, of which $505.8M is co-investment alongside clients and the remainder largely Proptech.

Ulbrich’s stated hurdle is exactly right in principle: every use of capital “has to be better than share repurchases,” and he claims the LaSalle commitments clear it “well above.” (INTERPRETATION: this is self-assessed and unverifiable externally, and the same hurdle logic would need re-testing now that the buyback is being executed near an all-time high.) The strategic rationale — an anchor commitment from the manager “drives a lot of confidence into the product” and unlocks third-party capital — is standard, credible practice in a business where LaSalle is sub-scale and had negative net flows in 2025.

The cost of this posture is visible: Proptech equity losses of $38.8M (FY25) and $53.8M (FY24) — $92.6M destroyed over two years on venture positions, all excluded from adjusted results. JLL Spark’s returns have been poor.

7.5 Incentives — where the analysis turns negative

Annual Incentive Plan (cash): Adjusted EBITDA 50% / Adjusted EBITDA Margin 25% / Strategic Factors 25%, plus a discretionary Leadership Multiplier. Ulbrich’s FY25 AIP paid 122.2% of a $3.0M target = $3,666,000.

Long-term (GEB LTIP): 60% performance share units / 40% restricted stock units, three-year cliff vesting. PSU metrics for the 2025–2027 cycle: Adjusted EPS 75%, Free Cash Flow Conversion Ratio 25%, with a Relative TSR modifier of ±20% against the S&P 500 (no positive modification if absolute TSR is negative). Payout range 0–200%. Ulbrich’s FY25 LTI target was $11.5M.

The completed 2023–2025 cycle paid 110.10% of target, comprising: 2023 GAAP diluted EPS of $4.67 against a $7.50 threshold = 0% on 25% weight; combined 2024–2025 GAAP diluted EPS of $27.70 against a $21.79 target = 145.2% on 50% weight; Relative TSR at the 85th percentile = 150% on 25% weight. Ulbrich received 46,791 shares.

Three problems.

1. There is no ROIC, return-on-capital, or return-on-tangible-capital metric anywhere in the plan. For a business whose eight-year average ROIC has hovered at its cost of capital, this is the metric that matters most, and it is absent — the same gap CBRE’s plan has. The presence of FCF Conversion at 25% is better than CBRE’s nothing, but it measures cash conversion, not cash returns.
2. Adjusted EPS at 75% of the PSU weight is mechanically inflated by the buyback. Management sets the numerator’s definition (adjusted EPS excludes restructuring, MSR marks, Proptech losses) and controls the denominator (a $3.0B authorization on a $15B market cap). A 3–4% annual reduction in share count contributes 3–4 points to the metric management is paid on, with no operating improvement required. The Accelerate 2030 “16% adjusted EPS growth” headline inherits precisely this issue.
3. Absolute pay is high and the ratio is wide. CEO 2025 Summary Compensation Table total $14,675,352; CEO pay ratio 243:1 against a median employee of ~$60,312. Say-on-pay support was 96.4% at the 28 May 2026 annual meeting, so shareholders are not objecting — but shareholders rarely object to plans that pay on EPS in a buyback cycle.

7.6 Insider behaviour

Zero code-P open-market purchases across 128 machine-parsed Form 4s spanning 28 June 2024 to 1 July 2026. All insider dispositions in the window are grants, tax withholdings, unit exercises, or 10b5-1 planned sales. Aggregate code-S sales were ~$12.6M, dominated by CEO Christian Ulbrich: 30,000 shares in eight tranches between 25 November and 11 December 2025 at $330.02–$332.18, ~$9.9M, all flagged 10b5-1, leaving him with 114,685 shares (~$37M at the current price). Others: Richard Bloxam 5,440 shares (~$1.6M), director Deborah McAneny 2,500 shares (~$0.75M), Larry Quinlan 805 shares, Andrew Poppink 275 shares.

(Caveat: 72 of 200 Form 4 documents returned only XSL-rendered HTML and could not be machine-parsed; the “zero code-P” conclusion is robust for the trailing ~25 months but is not verified for 2021 to mid-2024.)

INTERPRETATION: this is a missing positive rather than a red flag. All sales were planned; the CEO retains a substantial holding; no one dumped. But across a −12.5% AI-scare session, a two-day −19% drawdown, and a full round trip from $122 to $358, not one officer or director bought a share in the open market. The only buyer of JLL stock has been JLL. Set against a CEO who tells analysts the shares represent “the value we see,” that asymmetry is worth naming.

7.7 Governance

Eleven directors, all elected annually and all re-elected in May 2026 with 96%+ support. Christian Ulbrich has been President and CEO since 2016 — a decade of tenure spanning the full cycle, which cuts both ways: he presided over the 2023 trough and the 2025 record. Kelly Howe became CFO on 1 July 2025, succeeding Karen Brennan, who moved to CEO of Leasing Advisory — an internal succession rather than a departure, and a reasonably unusual one (the outgoing CFO taking a line role signals bench depth rather than conflict). KPMG ratified as auditor; no adverse ICFR opinion, no material weaknesses, no late filings across the five-year corpus. Equity overhang 4.87%.

Verdict: above-average capital allocation with a below-average incentive design. The M&A discipline is genuine, quantified, and directly responsible for JLL earning ~1.6× CBRE’s return on capital; the balance sheet is unlevered and the buyback is large and being executed. Against that, the buyback is running near an all-time high rather than at the lows, the incentive plan pays 75% on a per-share metric the buyback inflates and contains no return-on-capital measure at all, Proptech has destroyed $92.6M over two years, and no insider has bought a share in the open market in more than two years. Management has allocated capital intelligently in the one place it matters most — by not spending it — but the machinery that governs future allocation is not well designed.

8. Changes and Headwinds — Last Two Years

8.1 Strategic and structural changes

Segment reorganization, twice. Effective 1 January 2025, Property Management moved from the renamed Leasing Advisory segment into Real Estate Management Services (formerly Work Dynamics); Capital Markets, LaSalle and JLL Technologies were renamed Capital Markets Services, Investment Management and Software and Technology Solutions. Effective 1 July 2025, Proptech Investments moved out of Software and Technology Solutions into “All Other.” Effective 1 January 2026, Software and Technology Solutions ceased to be a standalone segment and became a fifth business line inside Real Estate Management Services; the Leasing Advisory revenue disaggregation was collapsed and Investment Management revenue simplified to two captions. (INTERPRETATION: three reporting changes in twelve months reduces comparability and, in the case of folding a loss-making segment into a profitable one, reduces visibility. Prior periods were recast, so the data is recoverable — but the disclosure trend is toward less granularity, not more.)

Accelerate 2030 (12 March 2026). The multi-year strategy and first explicit long-term financial targets in years: 8% revenue growth, 12% adjusted EBITDA growth, 16% adjusted EPS growth through the cycle, FCF conversion ≥80%. Six strategic “imperatives.” Simultaneously, the $2.2B incremental buyback authorization and a revamped LaSalle strategy.

CFO transition (1 July 2025). Kelly Howe replaced Karen Brennan, who became CEO of Leasing Advisory.

Property Management contract remediation (ongoing). JLL is systematically exiting or repricing Asia-Pacific Property Management contracts that Howe described as “structured in a way that, frankly, were just unattractive to us from a financial standpoint. Very, very, very high pass-through costs, low portions of actual value-add fee revenue.” ~60% actioned as of Q1-2026, roughly one-third renegotiated rather than exited. Originally expected to complete mid-2026; now extended to year-end because renegotiations take longer than exits. Management expects the FY26 revenue headwind to be offset by Americas growth.

(This is the most analytically revealing disclosure of the last two years. Management is voluntarily shrinking a “Resilient” revenue line because it produced revenue without economics — direct corroboration of the fee-revenue lens in Section 2.)

LaSalle capital commitments. $100M to JLL Income Property Trust (Jan-2025); €100M to LaSalle Encore+ (Apr-2026); Lp3F decarbonization fund first close with Shell (Q1-2026, ~$300M initial).

8.2 The AI repricing (11–12 February 2026)

The dominant market event of the period. Two sessions removed ~19% of JLL’s market value on sector-wide fears of AI disintermediation, with no company-specific news. The FY25 print one week later recovered +9.6% in a day. JLL has since traded back to $325.45, still 9.3% below the 29 January all-time high. The event changed the multiple, not the earnings — but it introduced a permanent new bear case that did not exist before, and the stock has not fully reclaimed its pre-event level six months on.

8.3 Macro and geopolitical

Rates remain the primary driver. JLL’s empirical interest-rate factor beta is −0.55 to −0.73; the rate factor has been running a +1.9 twenty-one-day z-score. The 14 May 2026 −7.0% session was a rate move, not a JLL move.

Middle East conflict. Ulbrich addressed it directly on the Q1-26 call: JLL’s Middle East business (anchored in Saudi Arabia and the UAE, built over 20 years) is “a low single-digit percentage of revenue”; there has been “no material impact on our consolidated results to date” and pipelines have continued to build. But he was notably candid on second-order risk: prolonged conflict means “higher energy prices and all the other implications around lack of fertilizers, impact on the chemical industry,” with the load falling hardest on Europe and energy-importing economies and least on the US. In Europe “we have seen some deals being canceled… some deals being delayed,” though “the overall momentum was still so strong that that is just taking away an additional outperformance.” Management says it “intentionally taken a conservative approach to leverage” as a result.

Guidance risk from comparables. Howe flagged that 2H-2026 laps “very strong quarters for leasing in the fourth quarter, and… very strong quarters last year for Capital Markets in the third and the fourth quarter,” and that any macro impact “would come in the back half of the year, and that is reflected in the range of the guidance.”

8.4 Headwinds inventory

Verdict: the last two years strengthen the thesis operationally and weaken it narratively. Operationally: record earnings, restored operating leverage, an unlevered balance sheet, a tripled buyback, voluntary pruning of uneconomic contracts, and the first explicit long-term targets in years. Narratively: a permanent new AI bear case, three segment reorganizations that reduce granularity, a new CFO, and a strategy whose headline EPS target leans partly on buyback arithmetic. Net: the business is in better shape than it was two years ago; the story is more contested.

9. Risk Analysis

The two risks that matter are #1 and #2, and they are the same risk viewed from different angles: two-thirds of JLL’s profit is transactional, and the market is being asked to capitalize record transactional earnings. Risk #3 is the one the market has already partially priced and that no one — including management — can currently resolve with evidence.

10. Valuation Discussion

No price target, no recommendation. This section quantifies what the current price embeds and what has to be true for it.

10.1 Where the stock trades

At $325.45 (24 July 2026 close), on ~46.0M shares:

10.2 Own-history context — the single most useful valuation datum

JLL is mid-range on earnings and sales, expensive on book. The P/B outlier is an artefact, not a signal: five years of buybacks have shrunk book equity relative to a rising price, so a high P/B percentile here measures capital return, not richness. Per the standing discipline on distorted denominators, read the P/E and P/S percentiles. Both say the same thing: JLL is priced in the middle of its own decade, neither cheap nor expensive.

10.3 Peer comparison

Source: AZI valuation_index, 24 July 2026. Percentiles are against each stock’s own multi-year history and are NOT cross-sectionally comparable; the raw multiples are.

JLL trades at a 45% discount to CBRE on trailing GAAP earnings and roughly 20 percentile points cheaper against its own history. Part of that discount is deserved: CBRE is 1.55× larger, more diversified, has a materially deeper recurring book as a share of profit (~53% vs JLL’s ~35%), owns the quantified data-centre story, and runs a ~$155.5B investment-management platform against LaSalle’s $86.4B. Part of it is not: JLL earns 9.4% ROIC against CBRE’s 6.0%, has positive rather than negative tangible equity, and reports adjusted earnings only 14.6% above GAAP against CBRE’s 66%. A 45% earnings-multiple discount for the higher-return, cleaner-accounting, better-capitalized operator is wider than the fundamentals justify. The gap is a narrative premium at CBRE, not a quality discount at JLL.

10.4 Embedded expectations

Solving a single-stage perpetuity at the current enterprise value of $16.14B:

On current cash flow, the price embeds only 3–4.6% perpetual growth. For a business that grew fee revenue high-single-digit, guided FY26 adjusted EPS +20%, and targets 12% through-cycle EBITDA growth, that is an undemanding expectation. This is the numerical core of the bull case.

But the sensitivity is severe and runs entirely through the mid-cycle question:

A 30% haircut to reflect a softer transaction tape — which is less than the FY22–23 experience, when free cash flow fell to −$5.9M and $388.9M — pushes the required perpetual growth to ~5.8%, which is demanding for a business earning its cost of capital. The market is not underwriting heroic growth; it is underwriting that current cash flow is roughly normal. That is the assumption to interrogate.

10.5 Scenario analysis

All scenarios are on adjusted diluted EPS with the share count falling ~3%/yr from ~46M under the existing authorization.

BEAR — the cycle rolls over (probability ~25%). Rates stay higher for longer, or a macro shock (Middle East escalation feeding through energy costs into European and Asian activity) stalls transaction volumes. Leasing and Capital Markets fee revenue falls ~15%; operating leverage reverses (the 2023 precedent: fee-revenue EBITDA margin compressed to ~13%); Real Estate Management Services holds but grows low single digits. Adjusted EPS falls to $15–16. The multiple compresses toward the bottom of JLL’s own range, 12–13×. Implied ~$185–210. Note the buyback partially cushions this — a $3B authorization against a falling price retires shares fast.

BASE — the recovery continues, then normalizes (probability ~55%). FY2026 lands near the top of guidance ($23.00–23.50) as management indicated. FY2027–28 revert to the Accelerate 2030 cadence: high-single-digit fee-revenue growth, low-double-digit EBITDA growth, plus 3–4 points from buyback. Normalized adjusted EPS settles at $21–23 through the cycle. At 14–16× — appropriate for a business earning ~9% ROIC with 35% of profit moated — implied ~$300–365. The current price of $325.45 sits at the midpoint of this range.

BULL — the volume recovery has real runway (probability ~20%). Global transaction volumes, still ~30% below the 2021 peak, continue recovering toward it; JLL keeps taking share (FY25 investment sales +21% vs a market up 18%; Q1-26 office leasing +12% vs volumes −1%); Accelerate 2030 delivers; LaSalle re-scales on seeded funds; the AI discount unwinds and the CBRE valuation gap narrows. Adjusted EPS reaches $26–28 by 2028. At 16–18× — a multiple JLL has held before — implied ~$420–500.

10.6 What the market is pricing correctly and incorrectly

Correctly: that JLL is a cyclical, not a compounder — the 17.5× trailing multiple is a cyclical multiple, not a franchise multiple, and that is the right category. That LaSalle is sub-scale. That free cash flow is volatile.

Possibly incorrectly: (a) the 45% discount to CBRE, which is not supported by returns on capital, earnings quality, or balance-sheet strength; (b) the AI discount, which has been applied uniformly across a sector where exposure differs materially by line — JLL’s most-exposed line is $379.6M of a $8.96B fee-revenue base; © the capital-return arithmetic, since a $3.0B authorization on a $15B market cap is a larger lever than most models carry.

The unresolved question: whether FY2025–26 free cash flow is the middle of a cycle or the top of one. Nothing in the current disclosure settles it. Global volumes say mid-cycle; JLL’s own two-year stacked growth rates say late-cycle.

11. Variant Perception

11.1 Consensus belief

Sell-side and screen-based consensus is constructive-to-bullish. Zacks moved JLL to Rank #1 (Strong Buy) on 25 June 2026 and Rank #2 (Buy) on 20 July, and lists it simultaneously as a top growth stock, a top momentum stock, a top value stock, and a “fast-paced momentum at a bargain” name. Consensus price targets implied 25–34% upside during June–July 2026. The prevailing narrative is: cyclical recovery with multi-year runway, AI fears overdone, cheap versus CBRE, big buyback. Seeking Alpha’s June-2026 framing — “Look Past AI Fears” — captures it.

11.2 The strongest bull case

1. The transaction cycle is mid-recovery, not peak. Global volumes remain ~30% below the 2021 peak while JLL’s fee revenue and margins are at records. If volumes normalize, the operating leverage that turned +11% revenue into +22% EBITDA in FY25 has years to run.
2. JLL is the better business at the returns line, and it is cheaper. 9.4% ROIC vs CBRE’s 6.0%; positive tangible equity vs negative; adjusted EPS 14.6% above GAAP vs 66%; $97M of two-year acquisition spend vs $2.7B. It trades at a 45% P/E discount to that peer.
3. The capital-return lever is unusually large. A $3.0B authorization is ~20% of the market cap, $2.7B remains, and Q1-26 alone retired ~2% of shares. At 14.4× forward earnings, every dollar repurchased is accretive.
4. The embedded expectation is modest. ~3.0–3.6% perpetual FCF growth at a 9% WACC against a company targeting 12% through-cycle EBITDA growth.
5. The AI selloff was a multiple event, not an earnings event. Nineteen percent came off in two sessions on no company news; a strong print reversed nearly half of it in one day. The most-exposed line is ~4% of fee revenue.

11.3 The strongest bear case

1. “Resilient” is 79% of revenue, 39% of fee revenue, and ~35% of profit. This is a more transaction-levered business than CBRE at the profit line, sold to the market on a resilience framing that only holds when reimbursed cost dollars are counted as revenue. The FY23 precedent — GAAP diluted EPS of $4.67 — is what this business does in a bad cycle.
2. Returns have never justified the moat claim. Eight-year average ROIC ~8.9% against a 9–10% WACC. Across a full cycle, JLL has earned approximately its cost of capital. No segment earns more than ~20% on the revenue it keeps.
3. Earnings may be peak-cycle. Seven consecutive double-digit revenue quarters, two-year stacked growth of +42% (investment sales) and +81% (debt advisory), Capital Markets adjusted EBITDA +63% in Q1-26 — and the hardest comparables of the recovery arrive in 2H-2026. Buying back $300M of stock at ~$301 near an all-time high on peak earnings would be value-destructive.
4. Free cash flow has not compounded in five years — $965.3M in 2020, $978.5M in 2025, negative in 2022 — and the >80% conversion target is unproven.
5. The incentive plan pays 75% on Adjusted EPS with no return-on-capital metric, while management controls a $3.0B buyback that mechanically moves that metric. The Accelerate 2030 16% EPS target embeds ~4 points of the same arithmetic.
6. No insider has bought a share in the open market in over two years, and the CEO sold 30,000 shares into the November–December 2025 high.
7. The AI question is genuinely unresolved. Management’s own defence of Value & Risk Advisory reduces to brand assertion. If AI compresses valuation, appraisal, and eventually parts of debt placement, the terminal value of a fee-per-transaction business changes materially — and no amount of near-term revenue growth answers it.

11.4 The 3–5 assumptions that actually matter

1. Is FY2025–26 free cash flow mid-cycle or peak-cycle? Everything hinges here. Mid-cycle → the base case is conservative. Peak-cycle → the buyback is destroying capital and the multiple is too high.
2. Does the outsourcing book’s captivity hold under AI-enabled competition and in-sourcing? JLL’s own 10-K names SaaS firms and self-performing clients as competitors.
3. Is the 45% valuation discount to CBRE a mispricing or a correct assessment of profit-mix cyclicality? Section 2 argues JLL is the more cyclical of the two at the profit line — which means part of the discount is earned.
4. Will management maintain M&A restraint? The entire ROIC advantage over CBRE rests on it. A single $1B+ deal at current services multiples would erase it.
5. Can Value & Risk Advisory hold its revenue? The cleanest available proxy for AI disintermediation risk in the whole sector.

11.5 The factor-positioning read

The empirical positioning is unambiguous and it constrains the framing. Momentum beta is negative (−0.127 in the Base model, −0.159 to −0.238 elsewhere) — this is not a crowded momentum trade despite the Zacks momentum labels. Interest-rate beta is strongly negative (−0.551 to −0.731) and the interest-rate factor has been running a +1.91 twenty-one-day z-score — the factor JLL is most exposed to is actively against it. Quality loading is essentially zero (−0.023 to −0.051), which is the market’s honest verdict on an 8.9% through-cycle ROIC. Value loading is faintly positive (+0.104 in the Base model). Market beta is 1.25–1.43 and SmallSize +0.64 to +0.83 — high-beta and small-cap-behaving despite a $15B capitalization. Model R² is 44–58%, with 26.4% annualized idiosyncratic volatility.

Risk-adjusted record (all annualized): y1 +24.5% at a 0.664 Sharpe with a −21.9% max drawdown; y3 +24.3%/yr at 0.659; y5 +11.9%/yr at 0.283 with a −55.5% max drawdown; lifetime +7.5%/yr at 0.132 with an −85.9% max drawdown. The recent window is negative: m6 −15.5% annualized (≈ −8.1% raw), m3 −14.6% annualized (≈ −3.9% raw).

Read: JLL is a high-beta, rate-sensitive, anti-growth, mildly anti-momentum, zero-quality cyclical trading 9% below an all-time high after a strong three years. It is neither the “one-way street” (momentum is negative) nor the “falling knife” (three-year annualized return is +24.3%). The factor model also independently reproduces the comp set — NMRK 0.972, CWK 0.971, CBRE 0.964 similarity — confirming that the market trades JLL as a pure CRE-services instrument, not as a data/technology franchise. That is where consensus may be offsides in both directions: the bulls calling it a momentum growth stock are contradicted by the loadings, and the bears calling it a broken franchise are contradicted by the track record. It is simply a cyclical, priced roughly like one.

12. Fact vs. Interpretation

13. Open Questions

1. Is FY2025–26 free cash flow mid-cycle or peak-cycle? The single unresolved question in this memo. Global transaction volumes ~30% below the 2021 peak argue mid-cycle; JLL’s own two-year stacked growth of +42% (investment sales) and +81% (debt advisory), seven consecutive double-digit revenue quarters, and record margins argue late-cycle. Not resolvable from current disclosure.

2. What is JLL’s data-centre and AI-infrastructure revenue, in dollars? JLL cites “new data center wins” in Project Management and “a meaningful contribution from data centers” in Q1-26 leasing, and lists data centres as a property type — but publishes no figure. CBRE quantifies >$3B of infrastructure revenue, a $1.7B Critical Infrastructure Services line guided to >60% growth, and 1,300+ data centres managed. Either JLL’s exposure is materially smaller than CBRE’s, or it is comparable and simply undisclosed. Both readings have large valuation consequences, and the disclosure asymmetry itself likely contributes to the multiple gap.

3. What is the fee-revenue and profit contribution of the APAC Property Management contracts being exited? Management says ~60% actioned and that the FY26 headwind will be “largely offset” by Americas growth, but has quantified neither the revenue nor the margin impact. Given that the whole exercise is an admission that some “Resilient” revenue carried no economics, the size matters.

4. How much of the Accelerate 2030 16% adjusted-EPS-growth target is buyback? The 4-point wedge over the 12% EBITDA target implies roughly a quarter, but JLL has not disclosed the assumed share-count trajectory. Without it, the target cannot be assessed as an operating goal.

5. What is customer concentration in Workplace Management? JLL discloses ~2.8bn sq ft under management and that contracts are terminable on 30–60 days’ notice, but no client concentration figures. The Software segment already reported revenue declines from “lower activity associated with large existing clients” — evidence that individual clients are large enough to move a line item.

6. Do the FY25 “discrete cost management actions” that offset the ~$25M healthcare actuarial deficit recur in 2026? If they were one-time, FY26 carries an unflagged ~$25M headwind against a $1.6B EBITDA base.

7. Will free-cash-flow conversion actually exceed 80%? It is a long-term target and 25% of the PSU weighting, but the 2020–2025 record includes a negative year and two well below 80%.

8. What did insiders do between 2021 and mid-2024? 72 of 200 Form 4 documents could not be machine-parsed. The zero-open-market-purchase finding is verified only for the trailing ~25 months.

9. Is there a threshold at which management abandons M&A restraint? Ulbrich says “there is no need to do any M&A” while simultaneously noting sellers are getting nervous about price. The entire returns advantage over CBRE depends on which of those statements governs.

14. What Must Be True

14.1 For the bull case

14.2 For the bear case

The decisive near-term evidence is the 30 July 2026 Q2 print and the 2H-2026 comparables. B1/R1 resolve there first. B3/R3 resolve slowly, over years, in the Value & Risk Advisory line.

15. Source Appendix

The full source list with URLs and access dates is given in Appendix B below.

Primary — SEC filings (all accessed 2026-07-25, reviewed in full):

• Form 10-K for FY2025, filed 2026-02-19 (jll-20251231.htm) — Items 1, 1A, 7, 7A, 8, 9A.
• Form 10-Q for Q1-2026, filed 2026-04-30 (jll-20260331.htm).
• Forms 10-K for FY2021–FY2024; Forms 10-Q for 2021Q2–2025Q3.
• Form 8-K, 2026-02-18 (Q4/FY2025 results); 2026-03-03 (segment recast); 2026-03-12 (Investor Briefing, Accelerate 2030, $2.2B incremental repurchase authorization); 2026-04-30 (Q1-2026 results); 2026-05-28 (Annual Meeting results).
• DEF 14A, filed 2026-04-17 (jll-20260417.htm); DEF 14A 2022–2025.
• Forms 4, 2024-06-28 through 2026-07-01 (200 filings retrieved, 128 machine-parsed).

Primary — company communications:

• JLL Q1-2026 earnings conference call transcript, 2026-04-30 (via ROIC.ai MCP).
• JLL press release, “JLL Reports 2025 Financial Results for Fourth Quarter and Full Year,” 2026-02-18.
• JLL press release, “JLL introduces Accelerate 2030 Strategy and long-term Financial Targets,” 2026-03-12.
• JLL press release, “JLL climbs to #175 on Fortune 500 list,” 2026-06-03.

Market and industry data:

• AZI price history CSV, https://azitrading.com/controls/download-data.php?t=JLL, accessed 2026-07-25.
• AZI valuation_index own-history percentile ranks for JLL, CBRE, CWK, NMRK, MMI, CSGP, 2026-07-24.
• FactorsToday factor model: /stock-loadings/JLL, /leaderboard/JLL, /stock-info/JLL, /stock-specific-vol/JLL, /related-stocks/JLL, /factor-returns/historic, accessed 2026-07-25.
• ROIC.ai MCP: income statement, balance sheet, cash flow, profitability ratios, enterprise value, news, earnings-call transcripts for JLL and CBRE, accessed 2026-07-25.
• JLL Research, Global real estate trends and perspectives (Q1-2026, May-2026) and US Office Market Dynamics, Q1 2026.
• CBRE press release, “CBRE Leads Global Real Estate Investment Sales Activity in 2025.”

Media:

• Bloomberg, “Real Estate Services Stocks Latest Domino in AI Scare Trade,” 2026-02-11.
• CNBC, “Office real estate stocks tumble as AI disruption casualties in the stock market grow by the day,” 2026-02-12.
• Bisnow, “5 Major Brokerages’ Stocks Plummet Amid Fears Of AI Impacts,” 2026-02-11.

All figures reconciled to primary filings. Where ROIC.ai and the 10-K disagreed — notably FY25 operating income ($1,173.3M per ROIC.ai vs $1,098.0M per the 10-K, the $75.3M restructuring difference) — the filing governs.

APPENDIX A — Standard Diligence Questionnaire

Jones Lang LaSalle Incorporated (NYSE: JLL) — 2026-07-25

A standard due-diligence questionnaire, answered from the primary sources cited in Appendix B and labelled FACT / INTERPRETATION / ASSUMPTION / OPEN QUESTION where it matters. Price reference $325.45 (2026-07-24 close).

General

What thoughtful questions have other investors asked about this company?

The Q1-2026 call (30 April 2026) is the best available window into what sophisticated holders actually want to know, and the questions cluster into five themes:

1. “Is your guidance just conservatism, or has the cycle already normalized?” (Anthony Paolone, JPMorgan). He backed into implied 2H growth for leasing and capital markets and found it “consistent or maybe even a little bit inside” the five-year Investor Day framework — and asked whether that meant the recovery was done. Howe’s answer was that the outlook is “roughly in line” with the long-term framework, that 2H laps very strong Q4-25 leasing and Q3/Q4-25 capital markets, and that any macro impact “would come in the back half.” This is the same mid-cycle-versus-peak-cycle question this memo identifies as decisive.
2. “How are you managing AI, and is disintermediation real?” (Jade Rahmani, KBW) — asked specifically about closed-loop data and what percentage of sales teams use AI. Answer: 75% adoption across core enablement products; 25,000 employees on enterprise AI applications daily, +60% year-over-year; “for now, we don’t see any risk of disintermediation.”
3. “What are the economics of the LaSalle co-investments and how do you measure them?” (Mitch Germain, Citizens). Answer: every use of capital must clear a hurdle that “has to be better than share repurchases,” plus cross-selling synergies.
4. “What are incremental margins going to do?” (Stephen Sheldon, William Blair; Rahmani). Answer: don’t read incremental margins quarterly — use a trailing twelve-month basis; Leasing margin flat for FY26 despite high-single-digit growth because producers hit higher commission tiers earlier; Capital Markets incremental margin “mid-30s.”
5. “Are tenants solving for AI headcount before committing to space?” (Julien Blouin, Goldman Sachs). Answer: no — pipelines strong, some clients say they “overshot on the downsizing through the pandemic,” and AI ecosystems are themselves driving leasing in San Francisco and New York.

Notably absent from the analyst questions: any challenge to the Resilient-versus-Advisory revenue framing, any question about return on invested capital, and any question about the absence of a ROIC metric in the incentive plan. (INTERPRETATION: the sell side is modelling this company on adjusted EPS and adjusted EBITDA — the same metrics management is paid on — and is not interrogating the capital base.)

Cyclicality & Earnings Nature

Are earnings at a cyclical high or low?

OPEN QUESTION — and the single most important one in the file. The evidence genuinely conflicts:

• Arguing “high”: FY2025 GAAP diluted EPS of $16.40 and adjusted diluted EPS of $18.80 are both records. Adjusted EBITDA margin on fee revenue reached 16.2%. Seven consecutive quarters of double-digit revenue growth. Two-year stacked growth of +42% in investment sales and +81% in debt advisory. Q1-26 Capital Markets adjusted EBITDA +63% LC. The hardest comparables of the cycle arrive in 2H-2026.
• Arguing “not high”: global CRE transaction volumes remain roughly 30% below the 2021 peak even after rising 19% in 2025 and 18% year-over-year in Q1-2026. If the industry’s transaction pool is a third below peak, JLL’s records are being set on a depressed volume base.

The reconciliation is that volumes are mid-cycle while JLL’s earnings are at a peak, because margin expansion (platform leverage) and share-count reduction have amplified each volume dollar. That combination is favourable — it means JLL is extracting more profit per unit of activity than in prior cycles — but it also means earnings are further above their own trend than volumes are above theirs.

Driven by the external environment or internal actions? Both, roughly two-thirds external. FY25 revenue growth of +11% tracked a market rising in the high-teens on volumes; JLL’s outperformance (investment sales revenue +21% vs a market up 18%; Q1-26 office leasing revenue +12% vs global volumes −1%) is the internal share-gain component. The profit growth, however, is disproportionately internal: revenue +11% produced adjusted EBITDA +22% because platform operating expenses grew only +8%.

How stable are revenues? Less stable than presented. Management’s “Resilient” category is 79.0% of gross revenue but only 38.9% of fee revenue once the $17,158.2M of client-reimbursed pass-through costs is stripped. Leasing Advisory plus Capital Markets — purely transactional — are 65.1% of segment adjusted EBITDA. The FY2023 precedent is the honest stability test: GAAP diluted EPS fell to $4.67 from $13.26 in 2022 and $18.47 in 2021.

Outlook for products/services? FY2026 guidance: adjusted EBITDA $1.575–1.675B (+12% at midpoint), adjusted diluted EPS $21.80–23.50 (+20% at midpoint), with management indicating on 30 April the year was “trending towards the upper end.” By segment: Real Estate Management Services mid-to-high single-digit revenue growth (second-half weighted); Leasing Advisory high single-digit with flat margins; Capital Markets low double-digit with mid-30s incremental margins; Investment Management low single-digit advisory fee growth, with incentive fees toward the lower end of the historical range and Q4-weighted.

How big will this market be — growing, shrinking, domestic or international? Global and growing, but cyclically. Global direct CRE transaction volume was ~$1.3T at the 2021 peak, troughed roughly a third lower in 2022H2–2023, and is recovering (+19% in 2025; Q1-2026 $216B, +18% y/y). The structural growth vector is outsourcing penetration — corporates consolidating fragmented vendor rosters onto global platforms — which is secular rather than cyclical. 38% of JLL’s revenue is non-US, spread across the UK (7.5%), euro area (6.4%), Australia (4.4%), India (3.5%), Canada, Hong Kong, mainland China, Singapore and Japan. Two-thirds of employees are outside the United States.

Business Quality & Competitive Moat

Is the industry getting more or less competitive? More, at the margin, and from a new direction. The traditional structure — a scale-tiered oligopoly (CBRE ~$40.6B > JLL $26.1B > Cushman & Wakefield ~$10B > Colliers ~$5.6B > Newmark ~$3.5B) over a fragmented tail — has been stable and consolidating for two decades, which is favourable. JLL’s own 10-K, however, names an expanding entrant set: “investment banking firms, investment managers, accounting firms, technology firms, software-as-a-service companies, firms providing co-working space… and companies that self-perform their real estate services with in-house capabilities.” The February 2026 AI repricing was the market’s judgment on that last category of threat.

How profitable is the business (ROIC, ROE)?

Eight-year average ROIC ~8.9% against an assumed 9–10% WACC. (INTERPRETATION: across a full cycle JLL has earned approximately its cost of capital — the defining quantitative fact about this business.) One material caveat in JLL’s favour: the invested-capital denominator includes $4,707.3M of goodwill accumulated over two decades of consolidation, so the operating business earns considerably more than 9.4% on the working capital it actually requires. Net capital additions are only 2.4% of fee revenue.

How profitable is the industry — how many competitors, what barriers to entry? Modestly profitable and structurally average. CBRE’s FY25 ROIC was 5.97% — lower than JLL’s — with ROE at parity (11.87% vs 11.78%). Barriers are real only in the outsourcing/servicing layer (multi-year contracts, embedded systems, global coverage) and in the Fannie Mae DUS licence (JLL is one of only 24 DUS lenders). In leasing and investment-sales brokerage, barriers are close to nil: producers are portable, mandates are re-bid deal-by-deal, and commission rates are set by market convention.

Can the business be easily understood? Yes, once one correction is made: read fee revenue, not gross revenue. Without that adjustment the company appears to be a facilities-management annuity; with it, the company is a brokerage with an annuity attached. Everything else — segment structure, fee mechanics, seasonality — is transparent and well disclosed.

Can it be undermined by foreign low-cost labour? Partly, and it already has been — to JLL’s benefit. India is JLL’s fifth-largest revenue currency (3.5%) and the firm operates regional hubs; a large share of back-office, analytics and shared-service functions sits in lower-cost geographies. The client-facing advisory work is inherently local and relationship-based and is not offshorable. The more relevant substitution threat is software and AI, not offshore labour.

Do brands matter? Moderately. JLL and LaSalle are genuine institutional brands and management cites brand-perception surveys, trade recognition and multi-decade client tenure. Brand governs access to the bid — it gets JLL invited to global mandates that sub-scale firms never see. It does not govern price on the bid: fee-revenue adjusted-EBITDA margins are 15.1–20.2% across every segment, which is what scale without pricing power looks like. Ulbrich’s defence of Value & Risk Advisory against AI rests explicitly on brand — “who is confirming the potential valuation where the brand aspect is absolutely significant” — which is the weakest form of the brand argument.

What is the nature of competition? Three distinct games. (1) Enterprise outsourcing — competed on global coverage, technology, service breadth and price, won in multi-year RFPs, and sticky once won. (2) Transactional brokerage — competed on individual producer relationships, market knowledge and data, re-bid every deal. (3) Investment management — competed on track record, product design and distribution, where LaSalle at $86.4B is sub-scale against CBRE IM’s $155.5B.

Customers’ switching costs? High in Workplace Management, low-to-nil elsewhere. Workplace Management contracts run three to seven years; JLL reports “a high renewal rate, with most clients renewing their contracts at least once; many of our largest contracts have been in place for more than a decade”; and although most are terminable on 30–60 days’ notice, “a transition period of six to twelve-months is more common in our industry.” The proof that this captivity is real: the outsourcing book grew through the 2022–23 transaction recession while Leasing and Capital Markets collapsed. Property Management is weaker — one-to-three-year contracts, 30–120 days’ notice — and JLL is currently exiting or repricing a tranche of them in Asia Pacific. Leasing and Capital Markets have no switching costs at all.

Financial Condition & Balance Sheet

Assets not fully recognized on the balance sheet? Yes, and they are the most valuable things JLL owns:

• The proprietary transaction dataset feeding JLL Falcon, Azara, GPT and LeasingOS. Internally developed, largely expensed, carried at a fraction of economic value. This is the asset management argues will defend the business against AI.
• Client relationships in the outsourcing book — multi-decade in some cases, with a six-to-twelve-month practical switching cost, but carried only to the extent they arrived through acquisitions.
• The Fannie Mae DUS licence and Freddie/HUD approvals — one of 24 nationally, supporting a $140.3bn servicing portfolio. Not separately capitalized.
• The producer roster — 58,600 professional non-reimbursable employees. Also the largest off-balance-sheet liability in economic terms, since they are portable.

Off-balance-sheet liabilities? Modest and well disclosed. $203.5M of unfunded Investment Management commitments and $7.3M for Proptech at 2025-12-31; $75.5M of maximum undiscounted earn-out payments across 11 acquisitions (only $17.2M accrued); $21.3M of deferred acquisition obligations; $941.1M of finance-lease obligations (on balance sheet, but excluded from the net-debt figure most commonly quoted); operating leases for office space; deferred compensation obligations funded by directly held insurance contracts. Defined-benefit pension contributions are expected to be immaterial in 2026. Nothing here is thesis-relevant.

How conservative is the accounting? Above average for the sector, on four tests:

1. Non-GAAP discipline. Adjusted diluted EPS of $18.80 is only 14.6% above GAAP diluted EPS of $16.40. CBRE’s Core EPS runs 66% above its GAAP EPS. The structural reason is that JLL does not add back acquisition-intangible amortization; its intangible amortization is dominated by mortgage servicing rights ($458.2M of a $666.7M net intangible balance), a genuine economic cost amortized through revenue.
2. Gross presentation of pass-throughs. JLL books reimbursable costs gross in both revenue and expense — inflating the headline but showing the full mechanics. It also discloses the gross contract cost line, which is what makes the fee-revenue calculation possible.
3. No goodwill gymnastics. $4,707.3M of goodwill, never impaired, growing only $96M in FY25 (mostly currency) because JLL barely acquires.
4. Clean audit. KPMG; no adverse ICFR opinion, no material weaknesses, no late (NT) filings across the five-year corpus; auditor ratified with 96%+ support.

Two softer spots: restructuring and acquisition charges recur every year ($75.3M FY25, $23.1M FY24 — the latter flattered by a −$32.6M earn-out release) yet are always excluded from adjusted results; and Proptech equity losses of $38.8M (FY25) and $53.8M (FY24) are excluded as “non-cash,” even though they represent the realized return on cash that genuinely left the building.

How CapEx-hungry is the business? Barely at all — this is a genuinely capital-light services firm. Net capital additions were $215.6M in FY25 (2.4% of fee revenue, 0.8% of gross revenue) and $185.5M in FY24, spent on office leasehold improvements, hardware and purchased/developed software. The real capital intensity sits in working capital (net reimbursables receivable, which swing with the growth rate of the outsourcing book) and in producer compensation (including forgivable employee loans), not in fixed assets.

Capital Allocation & Management

How much FCF does the business generate, how does management use it, what is the philosophy?

Six-year cumulative free cash flow of $3,723.1M, of which 45% went to buybacks and 15% to acquisitions. Free cash flow is volatile and working-capital-driven — it was negative $5.9M in FY2022 on a $770.4M working-capital swing — and has not compounded at all across five years ($965.3M in 2020, $978.5M in 2025). Management targets >80% free-cash-flow conversion of adjusted net income and has embedded it as 25% of the PSU weighting; the 2020–2025 record shows the target met in good years and clearly missed in 2022–2023. (INTERPRETATION: treat >80% as an incentivized aspiration, not a demonstrated capability.)

The stated philosophy, articulated on the Q1-26 call, is a three-way balance — organic investment first, then return of capital, then strategic M&A — with a single hard hurdle: every use of capital “has to be better than share repurchases.” That is the correct test. It is self-assessed and not externally verifiable, and it becomes harder to satisfy as the share price rises.

Significant acquisitions recently? No — and that is the story. Total cash paid for business acquisitions was $27.3M in FY2025 and $69.7M in FY2024, against CBRE’s $1,535M and $1,203M over the same two years. The last meaningful year was 2021 ($416.8M). (INTERPRETATION: this restraint is the direct arithmetic cause of JLL earning ~1.6× CBRE’s ROIC, and it is the single strongest item in the capital-allocation file.) The risk is prospective: Ulbrich simultaneously notes that “the M&A market overall has significantly increased in activity in our space” with sellers showing “a little bit of nervousness… with regards to the price levels they can achieve,” and says “it may become more attractive in the coming 6 months.”

Buying back shares? Aggressively, and increasingly. On 12 March 2026 the Board authorized an additional $2.2B, taking the repurchase program to $3.0B — the largest in company history and approximately 20% of the market capitalization. In Q1-2026 JLL repurchased $300M at an average ~$301, including a $200M accelerated share repurchase at ~$290, retiring nearly 2% of shares in a single quarter; $2.7B remained authorized. Management describes a ~$100M/quarter programmatic cadence plus opportunistic tranches. Share count fell from 51.105M (2020) to 46,393,114 at the 2 April 2026 record date — −9.2% over five years. No dividend (suspended in 2020, not reinstated).

(INTERPRETATION on execution quality: the pattern is mixed. The largest single year was 2022 ($688.4M) as the stock fell from ~$251 to ~$159 — good counter-cyclical behaviour. But repurchases were then cut to $92.2M in 2023, the trough year with the stock between $122 and $190 — buying least when cheapest. The 2026 program is being executed at $290–301 against a $121.97 five-year low and a $358.66 all-time high. Whether that is value-accretive depends entirely on whether current earnings are mid-cycle.)

Issuing large amounts of new shares to insiders? No. Stock-based compensation was $114.7M in FY2025 — 1.3% of fee revenue — low for a people business. Equity overhang was 4.87% at 2 April 2026 (all outstanding options, RSUs and PSUs plus shares available for future grant). Buybacks comfortably exceed dilution: share count has fallen every year since 2020.

Compensation policy of directors/management?

• Annual Incentive Plan (cash): Adjusted EBITDA 50% / Adjusted EBITDA Margin 25% / Strategic Factors 25%, plus a discretionary Leadership Multiplier. Ulbrich’s FY25 AIP paid 122.2% of a $3.0M target = $3,666,000.
• Long-term (GEB LTIP): 60% PSUs / 40% RSUs, three-year cliff. PSU metrics for 2025–2027: Adjusted EPS 75%, Free Cash Flow Conversion 25%, with a Relative TSR modifier of ±20% versus the S&P 500 (no positive modification if absolute TSR is negative). Payout 0–200%. Ulbrich’s FY25 LTI target: $11.5M.
• Completed 2023–2025 cycle: certified at 110.10% of target — 2023 GAAP diluted EPS $4.67 vs a $7.50 threshold = 0% on 25% weight; combined 2024–2025 GAAP diluted EPS $27.70 vs a $21.79 target = 145.2% on 50% weight; Relative TSR at the 85th percentile = 150% on 25% weight. Ulbrich received 46,791 shares.
• Levels: CEO 2025 Summary Compensation Table total $14,675,352; CEO pay ratio 243:1 (median employee ~$60,312). Say-on-pay approved with 96.4% support on 28 May 2026.
• Severance/change-in-control: enhanced severance of 18 months’ base plus 1.5× target AIP for the CEO (12 months plus 1× for other GEB members); change-in-control multiplier 3.0× for the CEO, 1.5× for others; no tax gross-ups.

(INTERPRETATION — the principal governance criticism: there is no ROIC, return-on-capital or return-on-tangible-capital metric anywhere in the plan. For a company whose eight-year average ROIC has hovered at its cost of capital, that is the metric that matters most and it is absent. Worse, Adjusted EPS carries 75% of the PSU weight and is mechanically inflated by a $3.0B buyback that management controls — a 3–4% annual reduction in share count contributes 3–4 points to the metric management is paid on, with no operating improvement required. The Accelerate 2030 headline of “16% annual adjusted EPS growth” against a “12% adjusted EBITDA growth” target makes the four-point wedge explicit. The presence of FCF Conversion at 25% is better than CBRE’s nothing, but it measures conversion, not returns.)

Motivations of management? Christian Ulbrich has been President and CEO since 2016 — a decade spanning the full cycle, the 2023 trough and the 2025 record. Kelly Howe became CFO on 1 July 2025, an internal promotion; the outgoing CFO, Karen Brennan, moved to CEO of Leasing Advisory rather than leaving, which signals bench depth rather than conflict. Eleven directors, all elected annually, all re-elected with 96%+ support.

Insider behaviour is the notable negative: across 128 machine-parsed Form 4s from 28 June 2024 to 1 July 2026 there is not a single code-P open-market purchase. All dispositions are grants, tax withholdings, unit exercises, or 10b5-1 planned sales totalling ~$12.6M — dominated by Ulbrich selling 30,000 shares in eight tranches between 25 November and 11 December 2025 at $330.02–$332.18 (~$9.9M), all 10b5-1, leaving him 114,685 shares (~$37M at the current price). Also: Richard Bloxam 5,440 shares (~$1.6M); director Deborah McAneny 2,500 shares (~$0.75M); Larry Quinlan 805; Andrew Poppink 275. (Caveat: 72 of 200 Form 4 documents returned only XSL-rendered HTML and could not be machine-parsed, so the finding is verified for the trailing ~25 months only.) (INTERPRETATION: a missing positive rather than a red flag — all sales were planned and the CEO retains a large stake — but through a −19% two-day drawdown and a full round trip from $122 to $358, the only buyer of JLL stock has been JLL.)

Valuation & Market Data

Is the stock an ADR, MLP, or K-1 issuer? No. JLL is a Maryland corporation with common stock, $0.01 par value, listed directly on the NYSE. Holders receive a Form 1099, not a K-1. No ADR structure, no partnership units, no dual-class shares — one class, one vote.

Dividend policy? None. JLL suspended its dividend in 2020 and has not reinstated it; trailing dividend yield is 0.0%. All shareholder return runs through buybacks: $1,663.5M since 2020, with a $3.0B authorization now in place and $2.7B remaining. (INTERPRETATION: for a company generating ~$978M of free cash flow with 1.0× net leverage and zero drawn on a $3.3B revolver, the absence of any dividend is a deliberate choice to maximize per-share arithmetic — consistent with an incentive plan that pays 75% on Adjusted EPS.)

How profitable is the business? On gross revenue the margins look thin and are misleading: FY25 GAAP operating margin 4.20%, adjusted EBITDA margin 5.46%, net margin 3.03%. On the $8,957.4M of fee revenue JLL actually keeps: GAAP operating margin 12.3% and adjusted EBITDA margin 16.2%. By segment on fee revenue: Investment Management 20.2%, Leasing Advisory 19.3%, Real Estate Management Services 15.1%, Capital Markets Services 15.1%, Software and Technology Solutions −6.2%. Returns: FY25 ROIC 9.44%, ROE 11.78%; eight-year average ROIC ~8.9%.

Is net income diverging from cash from operations? Not currently, but the relationship is unstable:

FY2025’s 1.51× is healthy. The FY2022 collapse to 0.31× is the warning: a $770.4M working-capital swing (chiefly net reimbursables, which grow with the outsourcing book) turned a $654.5M profit into $199.9M of operating cash and negative $5.9M of free cash flow. Q1-2026 again showed a seasonal free-cash-flow outflow, with Howe attributing it to “growth-related working capital headwinds, particularly within net reimbursables.” (INTERPRETATION: fast growth in the pass-through book consumes cash. The divergence risk is real, recurring and structural — not an accounting concern but a working-capital one.)

Where does the stock trade? At $325.45: 17.5× trailing GAAP earnings (46.7th percentile of JLL’s own decade), 14.4× the FY2026 adjusted EPS guidance midpoint, ~9.9× EV/FY26 guided adjusted EBITDA, 2.04× book, 7.2× tangible book, on a 6.5% FY25 free-cash-flow yield (5.8% after stock-based compensation). CBRE trades at 31.9× trailing GAAP earnings (73.6th percentile) — a 45% premium to JLL despite earning 5.97% ROIC against JLL’s 9.44%.

Risks & Downside

What factors would cause the stock to decline?

1. A transaction-cycle reversal. 65.1% of segment adjusted EBITDA sits in Leasing Advisory and Capital Markets. The FY2023 precedent is GAAP diluted EPS of $4.67. JLL’s empirical interest-rate factor beta is −0.55 to −0.73, and the rate factor has been running a +1.9 twenty-one-day z-score.
2. A 2H-2026 miss against the hardest comparables of the cycle — revealing FY25–26 as peak-cycle rather than mid-cycle. Q2 reports 30 July 2026.
3. Escalation of the AI-disintermediation narrative. The 11–12 February 2026 sessions removed ~19% on no company-specific news. A confirmed revenue decline in Value & Risk Advisory would give the narrative a fact to stand on.
4. A large, expensive acquisition that erases the ROIC advantage over CBRE — the entire quality differential rests on restraint.
5. A working-capital-driven free-cash-flow disappointment that undercuts the >80% conversion target.
6. Producer commission inflation compressing Leasing incremental margins further; FY26 Leasing margin is already guided flat despite high-single-digit revenue growth.
7. Middle East escalation working through energy costs into European and Asian activity — management’s own stated second-order channel.

Risk of a catastrophic loss? Low. The balance sheet is genuinely conservative: net debt $1,049.9M, reported net leverage 1.0× adjusted EBITDA at the seasonal peak, zero drawn on a $3.30B revolver maturing November 2028, zero commercial paper outstanding against a $2.5B program, $599.1M of cash, and positive tangible equity of ~$2.13B. Fixed-rate debt is small and cheap ($400M at 6.875% due 2028; €350M at 1.96–2.21% due 2027/2029), and a 50bp rate move changes net interest expense by only $3.5M. The largest single balance-sheet exposure is $4,707.3M of goodwill (63% of common equity), never impaired; a severe, sustained downturn could force a write-down that would erase most tangible-equity headroom — but goodwill impairment is a non-cash accounting event, not a solvency event. No litigation of disclosed materiality. No covenant stress.

Chance of a total loss? Effectively negligible. JLL is a 240-year-old franchise operating in 80+ countries with 113,200 employees, no meaningful leverage, ample undrawn liquidity, positive tangible equity, and a capital-light cost structure that can be flexed (variable compensation is the largest expense line and moves with revenue). The realistic downside is a 40–50% cyclical drawdown of the kind delivered in 2022–2023 (−55% peak to trough) or 2008, not an impairment of the enterprise. The genuine long-tail risk is slow structural erosion of the fee-per-transaction model by AI over a decade or more — a value-decay scenario, not a wipeout.

Recent News & Events

Has the business environment changed recently? Yes, in three ways.

1. The cycle turned decisively favourable. Seven consecutive quarters of double-digit revenue growth through Q4-2025; global transaction volumes +19% in 2025 and +18% year-over-year in Q1-2026; US Q1-2026 volumes $113B (+25%) with US office investment +61%; global office leasing at its highest level since the pandemic.
2. A new bear case appeared and has not gone away. On 11 February 2026 JLL and CBRE fell ~12% and Cushman & Wakefield ~14% in a single session — the worst day since the COVID crash for CBRE and CWK — as investors rotated out of “high-fee, labor-intensive business models” seen as exposed to new AI applications; JLL fell a further 7.6% on 12 February. A strong FY25 print on 18 February recovered +9.6% in a day, but the stock remains 9.3% below its 29 January all-time high six months on.
3. Geopolitics entered the outlook. Middle East conflict: JLL’s regional business is a low-single-digit percentage of revenue with no material consolidated impact to date, but management flagged European deal cancellations and delays and a second-order energy-cost channel, and said it has “intentionally taken a conservative approach to leverage.”

Significant acquisitions? No. $27.3M of total acquisition spend in FY2025, $69.7M in FY2024. The notable capital deployments were organic and principal: $100M into JLL Income Property Trust (January 2025), €100M into LaSalle Encore+ (announced 30 April 2026), and the first close of the Lp3F global decarbonization fund with Shell (~$300M initial size, Q1-2026).

Change in accounting policies? No accounting-policy changes, but three reporting-structure changes in twelve months: (i) effective 1 January 2025, Property Management moved into Real Estate Management Services and three segments were renamed; (ii) effective 1 July 2025, Proptech Investments moved out of Software and Technology Solutions into “All Other”; (iii) effective 1 January 2026, Software and Technology Solutions ceased to be a standalone segment and became a fifth business line inside Real Estate Management Services, the Leasing Advisory revenue disaggregation was collapsed, and Investment Management revenue was simplified to two captions. Prior periods were recast. (INTERPRETATION: the data remains recoverable, but the trend is toward less granularity — and folding a loss-making segment into a profitable one reduces visibility into exactly the technology business management cites as its AI defence.) The One Big Beautiful Bill Act (enacted 4 July 2025) was immaterial to FY2025; its international provisions are largely effective in 2026 and management again calls the impact immaterial.

Recent changes — new markets, facilities, management?

• Management: Kelly Howe became CFO on 1 July 2025, succeeding Karen Brennan, who became CEO of Leasing Advisory.
• Strategy: “Accelerate 2030” launched at the 12 March 2026 Investor Briefing in New York — the first explicit long-term financial targets in years: 8% annual revenue growth, 12% annual adjusted EBITDA growth, 16% annual adjusted EPS growth on average through the cycle, and free-cash-flow conversion ≥80%, built on six strategic imperatives.
• Capital return: the same day, the Board authorized an incremental $2.2B of repurchases, taking the program to $3.0B.
• Portfolio pruning: ongoing exit or repricing of Asia-Pacific Property Management contracts that management describes as having “very, very, very high pass-through costs, low portions of actual value-add fee revenue.” ~60% actioned as of Q1-2026, about a third renegotiated rather than exited; completion pushed from mid-2026 to year-end.
• Recognition: #175 on the 2026 Fortune 500, up from #188.
• Next catalyst: Q2-2026 results, 30 July 2026 — five days after this report date, and the first test of the hard second-half comparables.

APPENDIX B — Source Appendix

Jones Lang LaSalle Incorporated (NYSE: JLL) — 2026-07-25

All sources accessed 2026-07-25 unless otherwise stated. Primary sources are listed first. Where a third-party aggregator and a primary filing disagreed, the filing governs and the discrepancy is noted at the end of this appendix.

1. Primary — SEC filings

The trailing 60-month SEC corpus was enumerated and reviewed in full. Form breakdown across 507 index rows: 362 Form 4, 45 Form 8-K, 15 Form 10-Q, 10 Form 3, 5 Form 10-K, 5 DEF 14A, 5 DEFA14A, 5 Form S-8, 4 ARS, 2 Form 4/A, 1 Form S-3ASR, 1 Form 3/A. CIK 0001037976.

EDGAR access point: https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001037976&type=&dateb=&owner=include&count=40

Form 4 caveat. 72 of the 200 retrieved Form 4 documents returned only the XSL-rendered HTML representation and could not be parsed programmatically. The 128 parsed filings cover 28 June 2024 through 1 July 2026 with no gaps in the recent window, so the “zero open-market purchases” finding is robust for the trailing ~25 months but is not verified for 2021 through mid-2024.

2. Primary — company communications

3. Market and quantitative data

Methodological notes on third-party data.

• ROIC.ai’s get_enterprise_value returns a fiscal-quarter-END market-cap snapshot (JLL: $14.25B at 2026-03-31). Enterprise value in this report was recomputed at the live price of $325.45 on ~46.0M shares.
• ROIC.ai reports gross_margin = 100 for JLL FY2022–FY2025 — a tagging artefact arising because JLL stopped reporting a separate cost-of-services line. Not used.
• AZI valuation_index percentiles are against each stock’s own multi-year history and are not cross-sectionally comparable; the raw multiples are.
• FactorsToday loadings are L1-sparse and orthogonalized hierarchically, so the same factor’s beta legitimately differs across nested models. Betas are read within a single model throughout.

4. Industry and market research

Note: JLL Research is the company’s own research arm. Where a market-share claim rests on JLL Research data (e.g. “investment sales revenue up 21% versus a market up 18%”), that dependency is stated in the memo body.

5. Media and event coverage

Media items are used for event dating and for characterizing consensus. No valuation conclusion in this report rests on a media source, and no analyst price target is adopted.

6. Analytical frameworks

• Competition Demystified (Bruce Greenwald & Judd Kahn) — applied in Section 4 to name the advantage type (economies of scale plus customer captivity, confined to Workplace Management and Project Management), to run the market-share-stability and ROIC tests, and to establish that fee-revenue margins of 15–20% across every segment are the fingerprint of scale without pricing power.
• Capital Returns (Edward Chancellor / Marathon Asset Management) — applied in Section 3 to locate the industry in the capital cycle: favourable supply-side discipline in brokerage (a talent-cost business with no asset build), against capital flooding into data-centre development and services roll-ups, raising the overpaying-for-growth risk that JLL has so far declined to take.

7. Reconciliation notes and derived figures

Discrepancies identified and resolved.

1. FY2025 operating income. ROIC.ai reports $1,173.3M; the FY2025 10-K MD&A reports $1,098.0M. The difference is exactly the $75.3M of restructuring and acquisition charges, which ROIC.ai excludes from operating expenses. The filing governs: GAAP operating income for FY2025 is $1,098.0M, a 4.20% margin on gross revenue.
2. Enterprise value. ROIC.ai’s quarter-end snapshot ($14.25B market cap at 2026-03-31) understates EV at the live price. Recomputed: ~46.0M shares × $325.45 = ~$14.97B market cap; plus net debt $1,049.9M and non-controlling interests $120.2M = ~$16.14B.
3. Gross margin. ROIC.ai’s gross_margin = 100 for FY2022–FY2025 is a tagging artefact and was not used.

Derived figures — flagged because JLL does not publish them.

Assumptions stated explicitly. WACC of 9–10%, derived from a reported beta of 1.178, a ~4.5% risk-free rate, and negligible net leverage (reported net leverage 1.0× adjusted EBITDA at the seasonal peak). Share count of ~46.0M for market capitalization, between the 46,393,114 outstanding at the 2026-04-02 record date and the effect of continuing repurchases including the second tranche of the Q1 accelerated share repurchase delivered in Q2-2026.

Timing. This report is struck on information through Q1-2026 and the 2026-07-24 close. JLL reports Q2-2026 results on 2026-07-30, five days after the report date.