Sterling Infrastructure (STRL) AI Stock Analysis

• Market Cap: $14.12B
• Dividend Yield: N/A
• Average Volume (3M): 457.26K
• Price to Earnings (P/E): 44.6
• Beta (1Y): 2.43
• Revenue Growth: 6.20%
• EPS Growth: 72.81%
• Country: US
• Employees: 3,200
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 3.08
• Shares Outstanding: 30,719,374
• 10 Day Avg. Volume: 533,132
• 30 Day Avg. Volume: 457,258
• PEG Ratio: 2.34
• Price to Book (P/B): 8.44
• Price to Sales (P/S): 3.76
• P/FCF Ratio: 25.79
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 5.60
• Enterprise Value/Gross Profit: 24.36
• Enterprise Value/Ebitda: 29.06
• 1Y Price Target: $449.50
• Price Target Upside: -1.26% Downside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 12.11
• Revenue Forecast (FY): $2.83B

• Rating: 76 Outperform
• Price Target: $514.00 ▲(12.90% Upside)
• Action: Reiterated Date: 02/27/26
• Date: Action: Reiterated 02/27/26

STRL scores well on financial performance and an optimistic, backlog-supported 2026 outlook, reinforced by strong technical momentum. The main constraint on the overall score is premium valuation (high P/E) and the absence of a dividend yield, with additional watch items around cash-flow variability and segment concentration/building softness.

Positive Factors

Backlog & Pipeline Visibility

A materially enlarged signed backlog and visible future-phase pipeline provide multi-quarter revenue visibility, lowering near-term bid/revenue risk and supporting resource planning. This underpins scalable execution, supports margin consistency on contracted work, and aids medium-term growth planning.

Improved Balance Sheet & Leverage

Meaningful deleveraging and equity growth enhance financial flexibility to fund organic growth, M&A, and opportunistic buybacks while withstanding project timing shocks. Strong balance-sheet capacity reduces refinancing and covenant risk and supports disciplined capital allocation over the next several quarters.

Operational Productivity & Modularization

Adoption of AI and modular prefabrication boosts execution efficiency, lowers per-project labor and schedule risk, and can sustainably raise margins as scale grows. These productivity levers create durable operating leverage, supporting margin resilience across the project cycle and aiding competitive differentiation.

Negative Factors

Revenue Concentration Risk

High concentration in mission-critical/data-center work increases exposure to cyclical demand swings in hyperscale tech and semiconductor capex. A downturn or project deferrals in these end markets could disproportionately reduce revenue and utilization, amplifying earnings volatility.

Building Solutions Softness

Persistent housing affordability headwinds and a soft residential market depress a core segment, creating a near-term revenue and margin drag. Prolonged weakness here limits diversification benefits and could pressure consolidated margins if offsetting growth in higher-margin areas slows.

Elevated Acquisition & CapEx Deployment

Large recent M&A and rising CapEx increase execution and integration risk, and require sustained cash generation to realize assumed synergies. If acquisitions underperform or integration diverts management focus, margins and returns could be pressured over the medium term.

Sterling Infrastructure Business Overview & Revenue Model

Company Description

Sterling Infrastructure, Inc. engages in the transportation, e-infrastructure, and building solutions primarily in the Southern United States, the Northeastern and Mid-Atlantic United States, the Rocky Mountain states, California, and Hawaii. It undertakes infrastructure and rehabilitation projects for highways, roads, bridges, airports, ports, light rail, water, wastewater, and storm drainage systems for the departments of transportation in various states, regional transit authorities, airport authorities, port authorities, water authorities and railroads. The company also provides specialty site infrastructure improvement contracting services for blue-chip end users in the e-commerce, data center, distribution center and warehousing, and energy sectors. In addition, it undertakes residential and commercial concrete foundations for single-family and multi-family homes, parking structures, elevated slabs, and other concrete work for national home builders, regional and custom home builders, and developers and general contractors in commercial markets. The company was formerly known as Sterling Construction Company, Inc. and changed its name to Sterling Infrastructure, Inc. in June 2022. Sterling Infrastructure, Inc. was founded in 1955 and is headquartered in The Woodlands, Texas.

How the Company Makes Money

Sterling Infrastructure generates revenue through a diverse range of services in the infrastructure sector. The primary revenue streams include government contracts for public works projects, private sector contracts for commercial construction, and specialized services such as utility maintenance and environmental cleanup. The company often engages in long-term contracts which provide a steady income stream. Additionally, Sterling Infrastructure benefits from strategic partnerships with government agencies and private companies, allowing them to secure large-scale projects and enhance their market presence. Factors such as increased government spending on infrastructure development, urbanization trends, and the need for infrastructure upgrades also contribute to the company's earnings.

Sterling Infrastructure Financial Statement Overview

Summary

Strong multi-year revenue and profitability expansion, improved leverage (debt-to-equity down materially), and robust free cash flow generation. Offsets include some margin variability and uneven operating cash flow year to year, which is important for a project-based business.

Income Statement

Annual revenue has grown consistently from $1.23B (2020) to $2.49B (2025), with an acceleration in the latest year (2025 revenue growth ~11.5%). Profitability has expanded meaningfully: gross margin improved from ~14.6% (2020) to ~23.0% (2025) and net margin rose from ~3.4% to ~11.7%, driving net income up to $290M (2025) from $42M (2020). A key watch item is some year-to-year variability in operating profitability metrics (e.g., EBITDA margin lower in 2025 vs. 2024), suggesting margins can fluctuate with project mix and execution.

Balance Sheet

Leverage has improved materially, with debt-to-equity declining from ~1.44x (2020) to ~0.32x (2025), alongside a sizable build in equity ($267M to $1.11B) and asset growth ($0.98B to $2.63B). Returns on equity are strong (roughly ~22%–32% in recent years; ~26% in 2025), indicating efficient capital use. The main risk is that returns are high in a cyclical industry, so maintaining these levels may be harder if demand or project economics soften.

Cash Flow

Cash generation is solid, with operating cash flow of $440M and free cash flow of $363M in 2025, and free cash flow generally tracking net income well (free cash flow about ~70%–87% of net income across the period; ~82% in 2025). However, operating cash flow has been somewhat uneven year to year (down in 2025 vs. 2024 despite higher earnings), and free cash flow growth in 2025 was negative versus 2024, pointing to working-capital or timing volatility that investors should monitor.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.49B	2.12B	1.97B	1.77B	1.41B
Gross Profit	572.31M	426.12M	337.64M	274.57M	203.53M
EBITDA	405.92M	451.94M	277.34M	212.82M	142.32M
Net Income	290.15M	257.46M	138.66M	106.46M	62.65M
Balance Sheet
Total Assets	2.63B	2.03B	1.80B	1.47B	1.26B
Cash, Cash Equivalents and Short-Term Investments	390.72M	664.20M	471.56M	185.26M	64.77M
Total Debt	349.91M	369.27M	398.88M	491.16M	471.50M
Total Liabilities	1.53B	1.21B	1.18B	991.13M	901.45M
Stockholders Equity	1.11B	808.08M	618.91M	474.60M	358.77M
Cash Flow
Free Cash Flow	362.68M	416.15M	414.20M	158.21M	112.28M
Operating Cash Flow	439.99M	497.10M	478.58M	219.12M	158.93M
Investing Cash Flow	-551.92M	-185.85M	-87.75M	-89.75M	-223.45M
Financing Cash Flow	-161.54M	-118.62M	-104.53M	-32.79M	80.57M

Sterling Infrastructure Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 455.25
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STRL, the sentiment is Positive. The current price of 455.25 is above the 20-day moving average (MA) of 408.04, above the 50-day MA of 357.43, and above the 200-day MA of 305.37, indicating a bullish trend. The MACD of 25.64 indicates Negative momentum. The RSI at 68.26 is Neutral, neither overbought nor oversold. The STOCH value of 73.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STRL.

Sterling Infrastructure Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DY	83 Outperform	$12.41B	41.90	21.90%	―	13.19%	33.58%
STRL	76 Outperform	$14.12B	44.64	35.73%	―	6.20%	72.81%
PRIM	74 Outperform	$8.21B	30.28	17.79%	0.25%	21.45%	67.31%
ROAD	72 Outperform	$7.85B	62.40	13.71%	―	54.20%	38.64%
GVA	70 Outperform	$5.92B	37.49	17.59%	0.45%	6.87%	64.56%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
FLR	55 Neutral	$7.78B	-42.68	-1.42%	―	-1.81%	1228.51%

Sterling Infrastructure Corporate Events

Sterling Infrastructure posts strong 2025 results, upbeat 2026 outlook

On February 25, 2026, Sterling reported strong fourth-quarter and full-year 2025 results marked by double-digit revenue, earnings and cash flow growth, supported by the CEC acquisition and a strategic shift toward higher-margin services. Revenue for 2025 rose to $2.49 billion, adjusted net income increased 53% to $336.7 million, backlog and combined backlog surged more than 78% year over year to a combined $3.31 billion, and management issued 2026 guidance implying roughly 25% revenue growth and robust gains in adjusted earnings and EBITDA, underscoring confidence in demand for mission-critical infrastructure despite housing-related softness in its Building Solutions segment.

The most recent analyst rating on (STRL) stock is a Buy with a $486.00 price target. To see the full list of analyst forecasts on Sterling Infrastructure stock, see the STRL Stock Forecast page.