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Sterling Infrastructure (STRL)
NASDAQ:STRL
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Sterling Infrastructure (STRL) AI Stock Analysis

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STRL

Sterling Infrastructure

(NASDAQ:STRL)

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Outperform 78 (OpenAI - 4o)
Rating:78Outperform
Price Target:
$415.00
▲(10.16% Upside)
Sterling Construction's strong financial performance and positive earnings call are the primary drivers of its stock score. The company's robust growth in key segments and raised financial guidance underscore its strategic momentum. However, the high P/E ratio and challenges in the Building Solutions segment slightly temper the overall outlook.
Positive Factors
Revenue Growth
The 21% revenue growth, driven by key segments, indicates strong market demand and effective business strategies, supporting long-term growth.
Acquisition of CEC Facilities Group
The acquisition of CEC Facilities Group enhances Sterling's capabilities in E-Infrastructure, potentially increasing revenue and market competitiveness.
Financial Guidance Increase
Increasing financial guidance reflects management's confidence in strategic execution and market conditions, supporting long-term investor confidence.
Negative Factors
Building Solutions Segment Challenges
Challenges in the Building Solutions segment, due to market conditions, could hinder overall growth and require strategic adjustments.
Decline in Transportation Backlog
A decline in the Transportation backlog suggests potential future revenue pressures, necessitating focus on new project acquisitions.
Free Cash Flow Growth Concern
Declining free cash flow growth could impact financial flexibility and investment capacity, requiring attention to cash management strategies.

Sterling Infrastructure (STRL) vs. SPDR S&P 500 ETF (SPY)

Sterling Infrastructure Business Overview & Revenue Model

Company DescriptionSterling 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 MoneySterling Construction generates revenue primarily through contracts awarded for construction projects. The company engages in bidding for public sector projects, which typically include infrastructure improvements funded by government entities, as well as private sector contracts that may involve commercial developments or other construction needs. Key revenue streams come from project execution, which includes managing labor, materials, and equipment needed to complete construction tasks. Additionally, the company may enter joint ventures or partnerships with other firms to leverage resources and expertise, further enhancing its ability to win contracts and deliver projects efficiently. Factors contributing to earnings include the company's reputation for quality work, strong relationships with government agencies, and the ability to adapt to changing market conditions and regulatory environments.

Sterling Infrastructure Key Performance Indicators (KPIs)

Any
Any
Operating Income by Segment
Operating Income by Segment
Chart Insights
Data provided by:Main Street Data

Sterling Infrastructure Earnings Call Summary

Earnings Call Date:Aug 04, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 03, 2025
Earnings Call Sentiment Positive
The earnings call for Sterling Infrastructure demonstrated strong financial performance, with significant growth in revenue, EPS, and EBITDA, especially in the E-Infrastructure and Transportation segments. The company also raised its financial guidance for the year. However, challenges remain in the Building Solutions segment due to market conditions. Overall, the highlights significantly outweigh the lowlights.
Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Sterling Infrastructure reported a 21% revenue growth for the quarter, driven by a 29% increase in E-Infrastructure Solutions and 24% growth in the Transportation segment.
Significant EPS and EBITDA Increase
Adjusted earnings per share grew by 41% to $2.69, and adjusted EBITDA increased by 35% to $126 million.
Gross Profit Margin Expansion
The gross profit margin expanded by 400 basis points from the prior year to 23.3%.
E-Infrastructure Backlog Growth
The E-Infrastructure Solutions backlog grew by 44% to $1.2 billion.
Transportation Solutions Profit Growth
Adjusted operating profit for the Transportation segment grew by 78%, benefiting from a mix shift towards higher-margin services.
Strong Cash and Balance Sheet Position
Sterling concluded the quarter with $699.4 million in cash against $298.2 million in debt, resulting in a cash net of debt balance of $401.2 million.
Increased Financial Guidance
The company raised its revenue guidance to $2.1 billion to $2.15 billion and adjusted EPS guidance to $9.21 to $9.47.
Negative Updates
Building Solutions Revenue Decline
The Building Solutions segment saw a 1% revenue decline and a 28% drop in adjusted operating income, primarily due to affordability challenges in the housing market.
Decline in Transportation Backlog
Transportation Solutions backlog declined sequentially by 17%, reflecting strong revenue burn and seasonally slower awards.
Company Guidance
During the Sterling Infrastructure second quarter earnings call for 2025, guidance included several key metrics highlighting the company's robust financial performance and optimistic outlook. Revenue for the quarter increased by 21%, driven by a 29% rise in the E-Infrastructure Solutions segment and a 24% growth in the Transportation segment. The company reported a 41% increase in adjusted earnings per share, reaching $2.69, and a 35% rise in adjusted EBITDA, totaling $126 million. The gross profit margin expanded by 400 basis points to 23.3%, with operating cash flow at a strong $85 million. Sterling's backlog at the end of the quarter stood at $2 billion, marking a 24% year-over-year increase. The guidance for full-year 2025 projects revenue between $2.1 billion and $2.15 billion, and adjusted EBITDA between $438 million and $453 million, representing a 6% increase from previous guidance. Additionally, the book-to-burn ratios for the second quarter were 0.77x for backlog and 1.03x for combined backlog.

Sterling Infrastructure Financial Statement Overview

Summary
Sterling Construction exhibits strong financial health with robust revenue growth, improving profitability margins, and a solid balance sheet. The company has effectively reduced its leverage, but attention should be given to enhancing free cash flow growth.
Income Statement
85
Very Positive
Sterling Construction has demonstrated strong revenue growth, with a TTM increase of 1.5% and consistent annual growth over the past years. The company maintains healthy profitability margins, with a TTM gross profit margin of 22.19% and a net profit margin of 13.33%. EBIT and EBITDA margins are robust at 20.15% and 23.42%, respectively, indicating efficient operational management. The consistent improvement in margins and revenue growth highlights the company's strong market position and operational efficiency.
Balance Sheet
78
Positive
The balance sheet reflects a solid financial position with a manageable debt-to-equity ratio of 0.39 in the TTM period, showing a significant improvement from previous years. The return on equity is impressive at 35.49%, indicating effective use of shareholder funds. The equity ratio stands at 40.81%, suggesting a stable capital structure. However, the company should continue to monitor its debt levels to maintain financial flexibility.
Cash Flow
70
Positive
Sterling Construction's cash flow statement shows a slight decline in free cash flow growth at -4.39% in the TTM period, which could be a concern if it persists. However, the operating cash flow to net income ratio is healthy at 0.62, and the free cash flow to net income ratio is strong at 0.88, indicating good cash generation relative to earnings. The company should focus on improving free cash flow growth to enhance its cash flow stability.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.14B2.12B1.97B1.77B1.41B1.23B
Gross Profit474.46M426.12M337.64M274.57M192.07M179.93M
EBITDA500.68M451.94M277.34M211.43M142.32M126.43M
Net Income285.00M257.46M138.66M106.46M62.65M42.31M
Balance Sheet
Total Assets2.16B2.03B1.80B1.47B1.26B982.39M
Cash, Cash Equivalents and Short-Term Investments699.37M664.20M471.56M185.26M64.77M72.69M
Total Debt343.14M369.27M398.88M491.16M471.50M385.23M
Total Liabilities1.25B1.21B1.18B991.13M901.45M713.66M
Stockholders Equity881.75M808.08M618.91M474.60M358.77M267.27M
Cash Flow
Free Cash Flow434.54M416.15M414.20M158.21M112.28M86.42M
Operating Cash Flow495.44M497.10M478.58M219.12M158.93M119.28M
Investing Cash Flow-206.94M-185.85M-87.75M-89.75M-223.45M-30.49M
Financing Cash Flow-129.11M-118.62M-104.53M-32.79M80.57M-70.33M

Sterling Infrastructure Technical Analysis

Technical Analysis Sentiment
Positive
Last Price376.74
Price Trends
50DMA
327.00
Positive
100DMA
285.96
Positive
200DMA
216.77
Positive
Market Momentum
MACD
10.41
Positive
RSI
59.46
Neutral
STOCH
78.41
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 376.74 is above the 20-day moving average (MA) of 355.67, above the 50-day MA of 327.00, and above the 200-day MA of 216.77, indicating a bullish trend. The MACD of 10.41 indicates Positive momentum. The RSI at 59.46 is Neutral, neither overbought nor oversold. The STOCH value of 78.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STRL.

Sterling Infrastructure Risk Analysis

Sterling Infrastructure disclosed 42 risk factors in its most recent earnings report. Sterling Infrastructure reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Sterling Infrastructure Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
$11.53B40.9636.72%3.31%76.94%
$8.45B32.8220.65%12.61%10.33%
$7.91B2.00102.24%3.62%943.43%
$7.69B32.3317.01%0.22%15.08%55.10%
$4.58B34.9615.89%0.50%7.18%77.84%
$6.62B85.4210.60%39.18%1.79%
$10.79B15.437.44%2.01%2.89%-14.66%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
STRL
Sterling Infrastructure
376.74
220.61
141.30%
DY
Dycom
284.16
104.92
58.54%
FLR
Fluor
48.50
-4.70
-8.83%
GVA
Granite Construction
103.84
21.79
26.56%
PRIM
Primoris Services
141.79
78.75
124.92%
ROAD
Construction Partners
116.86
36.78
45.93%

Sterling Infrastructure Corporate Events

Executive/Board Changes
Sterling Construction EVP Ronald Ballschmiede Retires
Neutral
Sep 25, 2025

Ronald A. Ballschmiede, Executive Vice President of Sterling Infrastructure, Inc., has announced his retirement from all positions with the company and its subsidiaries, effective September 24, 2025. This announcement marks a significant transition in the company’s leadership as it prepares for his departure in 2025.

The most recent analyst rating on (STRL) stock is a Hold with a $348.00 price target. To see the full list of analyst forecasts on Sterling Construction stock, see the STRL Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Sterling Construction Highlights Strong Financial Performance
Positive
Sep 18, 2025

Sterling Infrastructure, Inc. presented its business and financial performance to investors, highlighting its strategic focus on high-margin projects and market expansion. The company reported strong financial performance, with an 8-year revenue CAGR of 20%, and emphasized its disciplined approach to project selection and resource allocation, which has built a foundation for success and future growth.

The most recent analyst rating on (STRL) stock is a Buy with a $355.00 price target. To see the full list of analyst forecasts on Sterling Construction stock, see the STRL Stock Forecast page.

Business Operations and StrategyM&A Transactions
Sterling Construction Completes Acquisition of CEC Facilities Group
Positive
Sep 2, 2025

On September 1, 2025, Sterling Infrastructure completed its acquisition of CEC Facilities Group, a specialty electrical and mechanical contractor based in Irving, Texas. This acquisition is expected to significantly enhance Sterling’s E-Infrastructure capabilities, with CEC projected to contribute $130 to $138 million in revenue and $17 to $18 million in adjusted EBITDA for the remainder of 2025. The move aligns with Sterling’s growth strategy, aiming to deliver more efficient project solutions and drive industry innovation.

The most recent analyst rating on (STRL) stock is a Buy with a $326.00 price target. To see the full list of analyst forecasts on Sterling Construction stock, see the STRL Stock Forecast page.

Sterling Infrastructure Reports Record Q2 2025 Results
Aug 6, 2025

Sterling Infrastructure, Inc., a prominent player in the infrastructure sector, specializes in E-Infrastructure, Transportation, and Building Solutions across the United States, focusing on sustainable and responsible operations.

Sterling Infrastructure Shines in Earnings Call
Aug 6, 2025

Sterling Infrastructure’s recent earnings call painted a picture of robust performance and promising future prospects. The company reported significant revenue growth, improved earnings and margins, and a strong backlog, indicating a solid position in the market. The acquisition of CEC Facilities Group and a strong cash position further enhance Sterling’s outlook. Despite some challenges in the Building Solutions segment and a sequential decline in Transportation backlog, the overall sentiment was overwhelmingly positive, suggesting a bright future for the company.

Business Operations and StrategyFinancial DisclosuresM&A Transactions
Sterling Construction Reports Record Q2 2025 Results
Positive
Aug 4, 2025

Sterling Infrastructure, Inc. reported record financial results for the second quarter of 2025, with a 21% increase in revenues and a 41% rise in adjusted diluted earnings per share. The company experienced significant growth in its E-Infrastructure and Transportation Solutions segments, despite a decline in its Building Solutions market. Sterling’s acquisition of CEC Facilities Group LLC is expected to enhance its service offerings and geographic expansion. The company raised its full-year guidance, anticipating continued growth in revenue and earnings.

The most recent analyst rating on (STRL) stock is a Buy with a $185.00 price target. To see the full list of analyst forecasts on Sterling Construction stock, see the STRL Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 23, 2025