Buy, Hold, or Take Profits in Sterling Infrastructure (STRL) Stock at All-Time Highs?

Core Viewpoint - Sterling Infrastructure (STRL) stock has reached new all-time highs, raising questions about whether to buy, hold, or take profits at over $240 per share [1] Performance Summary - STRL has increased nearly +100% over the last year, with a more than +40% rise year to date, and has gained nearly +2,400% over the last five years [2] Acquisition and Growth Strategy - Sterling Infrastructure announced the acquisition of CEC Facilities Group for $505 million, pending regulatory approval, which is expected to close in Q3 and add nearly $400 million to revenue this year and over $50 million in EBITDA [5][6] - The company is benefiting from the AI boom, securing several AI-related projects, including a $100 million contract for a data center development in the Southeastern United States [6] Project Focus and Backlog - The company is concentrating on high-margin projects, such as AI initiatives and the Hyundai Engineering America facility in Georgia, aimed at boosting EV and hybrid car production [7] - Sterling Infrastructure's total backlog currently stands at around $2 billion, providing a solid cushion for future revenue [9] Financial Outlook - Total sales are expected to dip 1% in fiscal 2025 to $2.09 billion, but are projected to rebound by 8% in FY26 to $2.26 billion [11] - The bottom line is expected to expand 41% in FY25 to $8.61 per share, with FY26 EPS projected to rise another 10% to $9.48 [13] Earnings Estimates - Current Zacks Consensus Estimates for FY25 EPS is $8.61, with year-over-year growth estimated at 41.15% [14] Valuation Metrics - STRL trades at 28.1X forward earnings, slightly above the S&P 500's 24.2X and the Zacks Engineering-R and D Services Industry Average of 22.7X [15] Strategic Insights - Following a significant rally, STRL holds a Zacks Rank 3 (Hold), indicating it remains a valuable asset in advancing America's infrastructure, though there is temptation to take profits at all-time highs [17] - Analysts have become bullish after the CEC acquisition announcement, suggesting STRL may serve as a prime buy-the-dip target [18]