Growth stocks are attractive to many investors, as above-average financial growth helps these stocks easily grab the market's attention and produce exceptional returns. However, it isn't easy to find a great growth stock. By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss. However, it's pretty easy to find cutting-edge growth stocks with the help of the Zacks Growth Style S ...

Investors interested in Engineering - R and D Services stocks are likely familiar with Sterling Infrastructure (STRL) and Aecom Technology (ACM) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look. Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings ...

Investors might want to bet on Sterling Infrastructure (STRL) , as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change. The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the ...

Sterling Infrastructure (STRL) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future. Over the past month, shares of this civil construction company have returned +5.3%, compared to the Zacks S&P 500 composite's +3.4% change. During this period, the Zacks Engineering - R and D Services industry, which Sterling Infrastructure falls in, has gained 4.3%. The key question no ...

Strategically seeking to be the leading infrastructure service provider in the United States, Sterling Infrastructure, Inc. (STRL) is currently riding high on increased federal funding. Its shares have soared 44% in the past year, outpacing the 38.2% gain in the Zacks Engineering - R and D Services industry. Image Source: Zacks Investment Research Additionally, STRL shares have outperformed the Zacks Construction sector and S&P 500, which has increased 33.5% and 24.4%, respectively, in the past year. STRL s ...

Core Viewpoint - Investors are increasingly seeking growth stocks that demonstrate above-average growth potential, with Sterling Infrastructure (STRL) identified as a strong candidate due to its favorable growth metrics and Zacks Rank [1][2]. Earnings Growth - Sterling Infrastructure has a historical EPS growth rate of 43%, with projected EPS growth of 26.5% for the current year, significantly outperforming the industry average of 15.1% [4]. Cash Flow Growth - The company exhibits a year-over-year cash flow growth of 31.6%, surpassing the industry average of 11.7%. Its annualized cash flow growth rate over the past 3-5 years stands at 34.5%, compared to the industry average of 3.4% [5][6]. Earnings Estimate Revisions - There has been a positive trend in earnings estimate revisions for Sterling Infrastructure, with the Zacks Consensus Estimate for the current year increasing by 7.8% over the past month, indicating strong future performance potential [7][8]. Investment Positioning - The combination of a Growth Score of A and a Zacks Rank of 2 positions Sterling Infrastructure favorably for outperformance, making it an attractive option for growth investors [8][9].

Core Insights - Sterling Infrastructure (STRL) is currently rated higher than Aecom Technology (ACM) based on Zacks Rank, with STRL at 2 (Buy) and ACM at 4 (Sell) [3] - STRL shows a more favorable earnings estimate revision trend compared to ACM, indicating a better analyst outlook for STRL [3] Valuation Metrics - STRL has a forward P/E ratio of 20.10, while ACM has a forward P/E of 21.62, suggesting STRL may be undervalued relative to ACM [5] - The PEG ratio for STRL is 1.34, compared to ACM's PEG ratio of 1.61, indicating STRL's expected earnings growth is more favorable [5] - STRL's P/B ratio is 5.15, slightly lower than ACM's P/B of 5.25, which may suggest a better valuation for STRL [6] - STRL holds a Value grade of B, while ACM has a Value grade of C, further supporting STRL as the superior value option [6]

Core Viewpoint - Sterling Infrastructure (STRL) has gained attention as one of the most searched stocks, indicating potential interest from investors and analysts regarding its future performance [1]. Earnings Estimate Revisions - The current quarter's earnings estimate for Sterling Infrastructure is projected at $1.68 per share, reflecting a year-over-year increase of +33.3% and a +9.5% change in the Zacks Consensus Estimate over the last 30 days [5]. - For the current fiscal year, the consensus earnings estimate stands at $5.66, indicating a +26.6% year-over-year change, with a +7.8% adjustment in the last month [5]. - The next fiscal year's consensus earnings estimate is $6.02, showing a +6.5% change from the previous year, with a +4.9% revision in the past month [6]. Revenue Growth Forecast - The consensus sales estimate for the current quarter is $599.9 million, representing a +7.1% year-over-year change [9]. - For the current fiscal year, the revenue estimate is $2.16 billion, indicating a +9.7% change, while the next fiscal year's estimate is $2.33 billion, reflecting a +7.7% change [9]. Last Reported Results and Surprise History - In the last reported quarter, Sterling Infrastructure achieved revenues of $582.82 million, a +11.6% year-over-year increase, and an EPS of $1.67 compared to $1.27 a year ago [9]. - The reported revenues exceeded the Zacks Consensus Estimate of $553.7 million by +5.26%, and the EPS surprise was +16.78% [10]. - The company has consistently beaten consensus EPS estimates in the last four quarters, while it has topped revenue estimates only once during this period [10]. Valuation - Sterling Infrastructure is graded B in the Zacks Value Style Score, indicating it is trading at a discount compared to its peers [14]. - Valuation multiples such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF) are essential for assessing whether the stock is fairly valued, overvalued, or undervalued [12][13]. Conclusion - The Zacks Rank 2 suggests that Sterling Infrastructure may outperform the broader market in the near term, supported by positive earnings estimate revisions and revenue growth [15].

Investment Thesis - Sterling Infrastructure (NASDAQ:STRL) has experienced a 47% stock rally since October 2023, outperforming the broader U.S. market, and maintains a high Seeking Alpha Quant rating [4] - The company is expected to benefit from recent developments and secular trends, with an attractive valuation and significant upside potential, leading to a "Strong Buy" rating [4] Recent Developments - In Q2 2024, Sterling Infrastructure reported an 11.6% year-over-year revenue growth, surpassing consensus estimates, with adjusted EPS increasing from $1.27 to $1.67 [5] - The operating margin improved by 95 basis points year-over-year, indicating strong operating leverage [5] - The company generated $70 million in free cash flow during Q2, enhancing its balance sheet and liquidity, with total cash exceeding total debt [6] Balance Sheet Overview - Total cash stands at $539.99 million, with total debt at $387.90 million, resulting in a net debt of -$152.09 million [7] - The current ratio is 1.24, and the quick ratio is 1.21, indicating solid liquidity [7] - The debt/free cash flow ratio is 3.65, and long-term debt constitutes 31.96% of total capital [7] Guidance and Future Outlook - Management raised guidance for FY 2024 revenue to approximately $2.19 billion, a 12% increase compared to FY 2022 [8] - Expected EBITDA growth from $264 million in 2023 to around $305 million in 2024 [8] Segment Performance - E-Infrastructure Solutions revenue was $241.3 million in Q2 2024, with an operating margin of 21.4% [10] - Transportation Solutions revenue increased to $232.8 million, maintaining an operating margin of 6.6% [10] - Building Solutions revenue was $108.7 million, with an operating margin of 12.7% [10] Market Position and Trends - The backlog in E-Infrastructure is growing, up 7% at the end of Q2 compared to the beginning of the year, indicating strong demand [11] - The company is positioned to benefit from increased data center investments driven by technological advancements and a housing shortage in the Building Solutions segment [12] Valuation Analysis - The stock has outperformed the broader U.S. market with a 35.5% rally since last August, and current multiples suggest undervaluation compared to sector medians [14] - A discounted cash flow (DCF) simulation indicates a fair value above $7 billion, suggesting a 120% upside potential [18] Conservative Scenario - Even under conservative revenue growth and free cash flow margin assumptions, the stock remains approximately 61% undervalued, indicating a significant margin of safety [81]

THE WOODLANDS, Texas, Aug. 8, 2024 /PRNewswire/ -- Sterling Infrastructure, Inc. (NasdaqGS: STRL) ("Sterling" or "the Company") today announced the appointment of Dan Govin as Chief Operating Officer ("COO"). In this role, Dan will be responsible for leading the execution of Sterling's strategic and operational activities. Dan brings 30 years of experience in operations and leadership to Sterling. Since 1994, Dan has held multiple commercial and operations management roles within the energy infrastructure i ...