Core Insights - Sterling Infrastructure, Inc. (STRL) is focusing on large-scale mission-critical projects, particularly data centers, which are enhancing its revenue visibility and bottom line [1][2] - The favorable market conditions for public infrastructure demand, supported by government initiatives like the Infrastructure Investment and Jobs Act (IIJA), CHIPS Act, and Inflation Reduction Act (IRA), are driving STRL's strategic shift [1] - STRL's earnings per share (EPS) growth is strong, with a reported 29.4% year-over-year increase in Q1 2025, and an adjusted operating margin expansion of 618 basis points [1] Financial Performance - The E-Infrastructure segment's backlog grew by 27% year-over-year to $1.2 billion, with data center-related work constituting over 65% of this backlog [2] - STRL's total backlog reached $2.13 billion at the end of Q1 2025 [2] - The company raised its 2025 adjusted EPS guidance to a range of $8.40-$8.90, reflecting an 18.5-25.5% year-over-year growth [3] Analyst Sentiment - Analysts are bullish on STRL due to increased public infrastructure demand, with 2025 earnings estimates trending upward to $8.61 per share, indicating a 41.2% year-over-year growth [4][7] - EPS estimates for the second, third, and fourth quarters of 2025 suggest year-over-year growth rates of 35.3%, 32.5%, and 43.8%, respectively [5] Market Position - STRL shares are performing well, gaining 35.7% year-to-date, outperforming the Zacks Engineering - R and D Services industry and the broader S&P 500 index [11] - The stock is trading at a forward 12-month price-to-earnings (P/E) ratio of 25.32X, indicating a premium valuation compared to industry peers, reflecting strong market potential [12]

Financial Highlights - The company's market capitalization was $5.77 billion as of June 2, 2025 [13] - The company reported 2024 revenue of $2.12 billion [13] - The company's 2024 adjusted EBITDA was $329 million, with a 15.1% margin [13] - The company had a net cash position of $329 million as of March 31, 2025 [13] Growth and Strategy - The company is focused on high-margin growth, strategic market expansion, and operational excellence [5] - The company's backlog includes approximately $750 million of future phases of work associated with current projects [26] - The company's Q1 2025 revenue was $430.9 million [57] - The company's Q1 2025 adjusted EBITDA was $80.3 million [57] Segment Performance - E-Infrastructure Solutions revenue was $924 million in 2024, with a 22.0% operating margin [38] - Transportation Solutions revenue was $784 million in 2024, with a 6.5% operating margin [45, 46] - Building Solutions revenue was $408 million in 2024, with a 13.2% operating margin [52] 2025 Guidance - The company projects full year 2025 revenue between $2.05 billion and $2.15 billion [69] - The company projects full year 2025 adjusted EBITDA between $410 million and $432 million [69]

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock char ...

In the latest close session, Sterling Infrastructure (STRL) was up +2.08% at $222.50. The stock outperformed the S&P 500, which registered a daily gain of 0.96%. Meanwhile, the Dow experienced a rise of 0.89%, and the technology-dominated Nasdaq saw an increase of 0.94%. Coming into today, shares of the civil construction company had gained 18.2% in the past month. In that same time, the Construction sector lost 2.29%, while the S&P 500 gained 0.5%. Market participants will be closely following the financia ...

Key Takeaways Stocks making new highs tend to make even higher highs. Both PM and STRL shares have benefited from strong quarterly results. Both companies' near-term outlooks allude to further gains. When stocks are cruising near all-time or 52-week highs, it reflects considerable bullishness with trends where buyers are in control. Stocks making new highs tend to make even higher highs, particularly when analysts' positive earnings estimate revisions are present.   That’s been precisely the case for Phil ...

Core Insights - Mergers and acquisitions (M&A) activity has shown notable fluctuations post-COVID, but there are signs of recovery in the market, with Sterling Infrastructure (STRL) making significant moves recently [1][7] Company Acquisition - Sterling Infrastructure announced the acquisition of Texas-based CEC Facilities Group, LLC for a total of $505 million, which includes $450 million in cash and $55 million in STRL stock [2] - The CEO of STRL, Joe Cutillo, emphasized that the combination of CEC's electrical services and Sterling's civil infrastructure services will enhance project timelines and customer value [2] - Following the acquisition announcement, STRL shares increased significantly, rising over 30% year-to-date and outperforming the S&P 500 [2] Strategic Focus - CEC will be integrated into Sterling's E-Infrastructure Solutions segment, aimed at enhancing its capabilities in data centers amid the growing AI market [4] - The E-Infrastructure Solutions segment provides advanced site development services for various sectors, including manufacturing and power generation [4] Financial Impact - The acquisition is expected to be immediately accretive to STRL's earnings, with contributions anticipated to begin in 2025 [5] - Prior to the acquisition news, STRL was already in a strong position, holding a Zacks Rank 2 (Buy), with rising EPS expectations [5]

Core Insights - Sterling Infrastructure, Inc. (STRL) is experiencing significant growth in e-infrastructure demand, reporting an 18% year-over-year revenue increase in its E-Infrastructure Solutions segment, with adjusted operating income rising 61% and margins expanding by over 600 basis points to 23% [1][9] - The company has a record e-infrastructure backlog of $1.2 billion and future-phase visibility nearing $2 billion, indicating strong demand and execution capabilities [2][9] - Management anticipates mid-to-high teens revenue growth for the E-Infrastructure segment in 2025, supported by trends in AI, e-commerce, and digital infrastructure [3] Financial Performance - Sterling reported adjusted earnings per share (EPS) of $1.63, a 29% increase year-over-year, and adjusted EBITDA rose 31% to $80 million [2][9] - The company’s pricing model mitigates risks from raw material and fuel cost fluctuations, helping to preserve margins [2] Competitive Landscape - Sterling faces competition from Quanta Services and EMCOR Group, both of which are also targeting high-growth sectors like data centers and semiconductors [4][7] - Quanta Services is expanding into data center development and grid modernization, while EMCOR focuses on mechanical and electrical construction in mission-critical environments [5][6] Market Position - Sterling's stock has surged 72% in the past three months, outperforming the Zacks Engineering - R and D Services industry, which rose 24.6% [8] - The company is currently trading at a price-to-earnings ratio of 22.7X, above the industry average of 20.54X [11] Future Outlook - The Zacks Consensus Estimate for Sterling's EPS indicates year-over-year growth of 40.3% for 2025 and 9.7% for 2026, reflecting positive market sentiment [12]

Summary of Sterling Infrastructure (STRL) Conference Call on CEC Acquisition Company and Industry - **Company**: Sterling Infrastructure (STRL) - **Acquisition Target**: CEC Facility Services, LLC - **Industry**: Electrical contracting, specifically in mission-critical sectors such as data centers, semiconductors, and advanced manufacturing Core Points and Arguments 1. **Strategic Rationale for Acquisition**: The acquisition of CEC is aimed at enhancing Sterling's e-infrastructure segment by adding electrical and mechanical services, which are crucial for high-growth, mission-critical markets [5][6][10] 2. **CEC's Market Position**: CEC is a leading non-union electrical contractor with over 80% of its sales derived from mission-critical markets, including major clients like Texas Instruments, Samsung, Intel, and Meta [10][14] 3. **Transaction Details**: The total upfront consideration for the acquisition is $505 million, comprising $450 million in cash and $55 million in Sterling common stock, representing a 9.6x multiple on CEC's estimated 2025 EBITDA [8][9] 4. **Growth Projections**: CEC is expected to generate revenues of approximately $390 million to $415 million in 2025, reflecting a 12% year-over-year growth, with an EBITDA margin of 13% [14][15] 5. **Operational Synergies**: The combination of Sterling and CEC is anticipated to improve project execution, accelerate timelines, and enhance customer relationships, allowing for a more integrated service offering [8][15] 6. **Backlog and Visibility**: CEC's contracted backlog and future opportunities are approximately 1.9 times their 2025 revenue expectations, indicating strong demand and visibility into future projects [14][40] 7. **Management Continuity**: CEC's founder, Ray Waddell, will remain in a strategic leadership role, ensuring continuity and leveraging his expertise for growth [13] Additional Important Insights 1. **Geographic Expansion**: CEC has a strong presence in Texas and is expanding into the Rocky Mountain and Southeast regions, which aligns with Sterling's growth strategy [11][19] 2. **Service Revenue Potential**: CEC's service revenue, primarily from maintenance and retrofitting, is expected to grow, providing a recurring revenue stream that enhances long-term value [58][59] 3. **Future M&A Opportunities**: Sterling is open to pursuing additional smaller acquisitions in the electrical contracting space to further enhance capabilities and geographic reach [42][43] 4. **Customer Demand**: Customers have expressed a desire for integrated electrical and mechanical services, which positions Sterling to capture more attractive projects in the semiconductor and data center sectors [54][55] This summary encapsulates the key points discussed during the conference call regarding Sterling Infrastructure's acquisition of CEC Facility Services, highlighting the strategic fit, financial expectations, and future growth opportunities.

STERLING TO ACQUIRE CEC FACILITIES GROUP June 17, 2025 Cautionary Statement Regarding Forward-Looking Statements This presentation contains, and the officers and directors of the Company may from time to time make, statements that are considered forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control, which may include statements about: the financial estimates or pr ...

Core Insights - Amentum Holdings (AMTM) and Sterling Infrastructure (STRL) are both stocks in the Engineering - R and D Services sector that present potential investment opportunities [1] - The Zacks Rank system indicates both companies hold a 2 (Buy) rating, suggesting positive earnings estimate revisions and improving earnings outlooks [3][4] Valuation Metrics - AMTM has a forward P/E ratio of 10.60, while STRL has a forward P/E of 23.70, indicating AMTM may be undervalued compared to STRL [5] - AMTM's PEG ratio is 0.82, suggesting better value relative to its expected earnings growth compared to STRL's PEG ratio of 1.58 [5] - AMTM's P/B ratio is 1.21, significantly lower than STRL's P/B of 7.47, further supporting AMTM's valuation as more favorable [6] Value Grades - Based on the valuation metrics, AMTM has earned a Value grade of A, while STRL has a Value grade of C, indicating AMTM is currently the superior value option [6][7]