Core Insights - Ongoing investment in U.S. infrastructure and advanced facilities is driving strong activity in transportation, water systems, and mission-critical developments like data centers and semiconductor facilities, with Sterling Infrastructure, Inc. (STRL) and Jacobs Solutions Inc. (J) positioned as key beneficiaries [1][2] Group 1: Company Performance - Sterling is experiencing momentum from mission-critical and data center projects, supported by large, complex projects and increasing customer demand [2] - Jacobs is expanding in advanced facilities, consulting, and digital-led infrastructure programs, leveraging technology and AI to enhance delivery [2] - Sterling's E-Infrastructure Solutions business saw a 123% year-over-year revenue increase in Q4, with a signed backlog of $3 billion, up 78% year-over-year, indicating strong revenue visibility [5][7] - Jacobs reported a 12% year-over-year gross revenue growth in Q1 of fiscal 2026, with a record backlog of $26.3 billion, up 21% year-over-year [8][9] Group 2: Market Dynamics - Sterling's Transportation Solutions segment is expected to contribute steadily, with a backlog of $1.1 billion, up 81% year-over-year, supported by ongoing infrastructure funding [7] - Jacobs benefits from broad-based growth driven by investments in data centers, semiconductor facilities, and critical infrastructure [8] - Both companies emphasize backlog visibility and multiyear project flow, positioning them for sustained growth in infrastructure and advanced facility markets [2][20] Group 3: Financial Metrics - The Zacks Consensus Estimate for Sterling's 2026 EPS has increased to $13.69, indicating a 25.8% year-over-year earnings rise on projected revenue growth of 24.6% [17] - Jacobs' fiscal 2026 EPS estimate remains at $7.13, reflecting a 16.5% year-over-year earnings rise on projected revenue growth of 9.4% [19] - Sterling's stock shows a stronger growth profile supported by accelerating demand in E-Infrastructure, while Jacobs faces near-term margin variability [20] Group 4: Investment Outlook - Sterling holds a Zacks Rank 1 (Strong Buy), indicating stronger growth momentum and improving earnings visibility compared to Jacobs, which has a Zacks Rank 3 (Hold) [21]

Core Insights - Sterling Infrastructure, Inc. (STRL) reported strong fourth-quarter 2025 results, with earnings and revenues exceeding estimates by 15.8% and 16.6% respectively [1] - The company experienced significant year-over-year growth across key metrics, driven by its E-Infrastructure segment [2] Financial Performance - Adjusted diluted earnings per share reached $3.08, a 78% increase from the prior year, while revenues totaled $755.6 million, up 51% [2] - Gross margin expanded by 30 basis points to 21.7%, marking a record level for the fourth quarter [2] - Adjusted EBITDA grew 70% year over year to $142.1 million [2] Stock Performance - STRL shares gained 22.9% over the past three months, outperforming the Zacks Engineering - R and D Services industry, the broader Construction sector, and the S&P 500 Index [3][5] - Compared to peers like AECOM, Fluor Corporation, and KBR, STRL has shown superior stock performance [5] E-Infrastructure Growth - The E-Infrastructure segment saw a 123% year-over-year revenue increase in Q4, with 67% organic growth, primarily driven by data center construction [8] - The company is well-positioned to capitalize on sustained demand for mission-critical projects, including data centers and semiconductor developments [6][12] Backlog and Future Opportunities - Sterling entered 2026 with a signed backlog of $3 billion, reflecting a 78% increase from the previous year, and a potential work pool approaching $4.5 billion [9][10] - Much of the future work is tied to ongoing projects with existing customers, providing steady revenue opportunities [10] Transportation Solutions Segment - The Transportation Solutions segment reported a backlog of $1.1 billion, an 81% year-over-year increase, driven by strong award activity [13][14] - Management anticipates continued growth in this segment, with revenues expected to rise in the low to mid-single-digit range in 2026 [15] Valuation Metrics - STRL shares are currently trading at a forward P/E ratio of 31.51, which is a 22.8% premium to the industry average of 25.65 [16] - Compared to peers, STRL appears overvalued, with AECOM, Fluor, and KBR having lower forward P/E ratios [17] Earnings Estimates - The 2026 earnings estimate for STRL has increased to $13.69 per share, implying a year-over-year growth of 25.8% on projected revenue growth of 24.6% [18]

Core Insights - Sterling Infrastructure, Inc. (STRL) reported strong fourth-quarter 2025 results, with adjusted earnings and revenues exceeding expectations and showing year-over-year growth [1][10]. Financial Performance - Adjusted earnings per share (EPS) reached $3.08, surpassing the Zacks Consensus Estimate of $2.66 by 15.8%, and increased from $1.73 in the same quarter last year [4]. - Revenues totaled $755.6 million, exceeding the consensus mark of $648 million by 16.4% and rising 51.5% from $498.8 million year-over-year [4]. - Adjusted EBITDA increased by 70% year-over-year to $142.1 million, with gross margin expanding by 30 basis points to 21.7%, reflecting a shift towards higher-margin services [5]. Segment Performance - E-Infrastructure Solutions generated revenues of $521 million, a significant increase from $234 million year-over-year, with adjusted operating income rising to $115.4 million from $60.3 million [6]. - Transportation Solutions reported revenues of $152.7 million, down 12.6% from $174.7 million in the previous year, but adjusted operating income grew to $18.6 million from $9.2 million [7]. - Building Solutions saw revenues decline to $81.9 million, down 9.1% from $90.1 million, with adjusted operating income falling to $8.1 million from $12.6 million [8]. Cash Flow and Debt - At the end of Q4, cash equivalents were $390.7 million, down from $664.2 million at the end of 2024, while long-term debt decreased to $275.9 million from $289.9 million [9]. Future Guidance - For 2026, Sterling projects revenues between $3.05 billion and $3.20 billion, exceeding the Zacks Consensus Estimate of $2.83 billion, with adjusted net income expected between $422 million and $441 million [12]. - Adjusted EPS is projected to be in the range of $13.45 to $14.05, higher than the previous estimate of $12.25 [12].

Financial Data and Key Metrics Changes - The company achieved strong revenue growth of over 32% and adjusted diluted EPS growth of over 53% for the full year 2025 [6] - Full year gross margins reached 23%, and adjusted EBITDA margins exceeded 20% for the first time in history [6] - Operating cash generation remained strong at $440 million for the full year [6][12] - In Q4 2025, revenue grew 69%, with adjusted earnings per share increasing by 78% to $3.08 [7] Business Line Data and Key Metrics Changes - E-Infrastructure Solutions revenue grew 123% in Q4, with 67% organic growth, and full year revenue grew 59% [7][8] - Transportation Solutions revenue grew 24% in Q4 and 17% for the full year, with adjusted operating profit growing over 100% in Q4 [10] - Building Solutions saw a decline in revenue of 6% for the full year and 9% in Q4, with adjusted operating profit declining 23% [11] Market Data and Key Metrics Changes - Signed backlog at the end of Q4 totaled $3 billion, a 78% increase from year-end 2024 [8][12] - The Texas market showed strong growth, particularly in electrical and site development, with significant opportunities ahead [10][17] Company Strategy and Development Direction - The company is focused on expanding its E-Infrastructure Solutions and leveraging its strong backlog and market visibility for growth [17] - There is a commitment to geographic expansion, particularly in Texas and the Pacific Northwest, to support large, mission-critical projects [17][20] - The company is exploring acquisitions that enhance service offerings and geographic footprint, with a focus on high-quality targets [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the multiyear opportunities across markets, particularly in E-Infrastructure and Transportation Solutions [17][19] - The company anticipates continued strong demand in the data center market and expects E-Infrastructure revenue growth of 40% or higher in 2026 [18] - Management acknowledged challenges in the Building Solutions segment but remains optimistic about long-term growth potential [20] Other Important Information - The company is forecasting 2026 revenue of $3.05 billion to $3.2 billion, with adjusted diluted EPS of $13.45 to $14.05 [16] - Cash flow from operating activities for 2025 was $440 million, with expectations for continued strength in 2026 [12][13] Q&A Session Summary Question: Transportation awards and backlog strength - Management noted that while there were no major projects, good bid activity is expected to continue through the funding cycle [24] Question: Update on Texas site prep and joint awards at CEC - Management expressed excitement about the Texas market and anticipated significant awards in the first half of the year [27] Question: Pipeline evolution at CEC and margin expectations - Management indicated that jobs are getting larger, leading to improved margins as CEC shifts towards data center projects [35] Question: Future phase work and customer relationships - The $1 billion in future phase work is tied to existing customers and is expected to convert into backlog as projects progress [42] Question: Capital allocation priorities - Management emphasized a focus on geographic expansion and service enhancement rather than pursuing a fourth leg of business [47] Question: Market opportunities in manufacturing and high tech - Management believes the semiconductor market is in its early stages, with significant projects expected in the coming years [54]

Financial Data and Key Metrics Changes - The company achieved strong revenue growth of over 32% and adjusted diluted EPS growth of over 53% for the full year 2025 [6] - Full year gross margins reached 23%, and adjusted EBITDA margins exceeded 20% for the first time in history [6] - Operating cash generation remained strong at $440 million for the year [6] Business Line Data and Key Metrics Changes - E-Infrastructure Solutions revenue grew 59% for the full year, with 40% organic growth, and adjusted operating income grew 67% [8] - Transportation Solutions revenue grew 17% for the full year, with adjusted operating profit growing 66% [10] - Building Solutions revenue declined 6% for the full year, with adjusted operating profit declining 23% [11] Market Data and Key Metrics Changes - Signed backlog at the end of the quarter totaled $3 billion, a 78% increase from year-end 2024 [8] - The Texas market showed strong growth, particularly in electrical and site development [10] - The company reported a significant increase in backlog for Transportation Solutions, which ended the quarter at $1.1 billion, an 81% year-over-year increase [10] Company Strategy and Development Direction - The company remains committed to its guiding principle, "The Sterling Way," focusing on people, environment, investors, and communities while building America's infrastructure [6] - Future growth is anticipated in E-Infrastructure, with expectations of 40% revenue growth or higher in 2026 [18] - The company is actively looking for acquisitions that enhance service offerings and geographic footprint, with more high-quality targets available in the market [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the multiyear opportunities across markets, particularly in E-Infrastructure and Transportation Solutions [17] - The company expects continued strong demand in the Texas data center market and anticipates significant growth in semiconductor and manufacturing projects [18] - Management acknowledged challenges in the Building Solutions segment but remains optimistic about long-term growth potential [20] Other Important Information - The company initiated guidance for 2026, projecting revenue of $3.05 billion to $3.2 billion and adjusted diluted EPS of $13.45 to $14.05 [16] - Cash flow from operating activities for 2025 was strong at $440 million, with expectations for continued strength in 2026 [12] Q&A Session Summary Question: Transportation awards and backlog strength - Management noted that while there were no major projects, good bid activity is expected to continue through the funding cycle, with 50%-60% of total funding still available [24] Question: Update on Texas site prep and joint awards at CEC - Management expressed excitement about the Texas market, indicating strong demand for data center expansion and site development, with significant awards expected in the first half of the year [27] Question: Pipeline evolution at CEC and margin expectations - Management confirmed that jobs are getting larger, with data center projects evolving into data campuses, leading to improved margins as the mix shifts towards larger projects [34] Question: Future phase work and customer relationships - The $1 billion in future phase work is tied to existing customers, with expectations for continued acceleration in project awards [42] Question: Capital allocation priorities - Management emphasized a focus on geographic expansion and service enhancement within infrastructure, while remaining open to strategic acquisitions if the right opportunities arise [47] Question: Market opportunities in manufacturing and high-tech - Management believes the semiconductor market is in its early stages, with significant projects expected to emerge in the coming years [54] Question: AI-driven tools and competitive positioning - Management highlighted ongoing AI initiatives that have improved project management capacity and overall efficiency, positioning the company favorably against competitors [90]

Financial Data and Key Metrics Changes - The company achieved strong revenue growth of over 32% and adjusted diluted EPS growth of over 53% for the full year 2025 [6] - Full year gross margins reached 23%, and adjusted EBITDA margins exceeded 20% for the first time in history [6] - Operating cash generation remained strong at $440 million for the year [6] Business Line Data and Key Metrics Changes - E-Infrastructure Solutions revenue grew 59% for the full year, with 40% organic growth, and adjusted operating income grew 67% [8] - Transportation Solutions revenue grew 17% for the full year, with adjusted operating profit growing 66% [10] - Building Solutions revenue declined 6% for the full year, with adjusted operating profit declining 23% [10] Market Data and Key Metrics Changes - The signed backlog at the end of Q4 2025 totaled $3 billion, a 78% increase from year-end 2024 [8] - The Texas market showed strong growth, particularly in electrical and site development, with significant opportunities ahead [10] Company Strategy and Development Direction - The company remains committed to its guiding principle of taking care of people, the environment, investors, and communities while building America's infrastructure [6] - Future growth is anticipated in E-Infrastructure Solutions, with expected revenue growth of 40% or higher in 2026 [18] - The company is focusing on geographic expansion and incremental electrical footprint and services, with a strong emphasis on data centers and semiconductor projects [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the multiyear opportunities across markets, particularly in E-Infrastructure and Transportation Solutions [17] - The company expects continued strong demand in the Texas data center market and anticipates growth in the semiconductor and manufacturing sectors [18] - Management acknowledged challenges in the Building Solutions segment but remains optimistic about long-term market share gains [20] Other Important Information - The company is forecasting 2026 revenue of $3.05 billion to $3.2 billion, with adjusted diluted EPS of $13.45 to $14.05 [15] - Cash flow from operating activities for 2025 was strong at $440 million, with expectations for continued strength in 2026 [12] Q&A Session Summary Question: Update on transportation awards and backlog - Management noted that while there were no major projects, bid activity remains strong, and funding will continue through extensions of existing bills [25] Question: Progress in Texas on site prep and joint awards at CEC - Management expressed excitement about the Texas market and indicated that significant awards would be announced in the first half of the year [28] Question: Pipeline evolution at CEC since acquisition - Management confirmed that jobs are getting larger, with data centers evolving into data campuses, leading to margin improvements [34] Question: Legacy site development margins - Management indicated that margins are not expected to decline, with opportunities for improvement through larger jobs and strategic investments [39] Question: High probability future phase work - Management clarified that the $1 billion in future phase work is tied to existing projects and customers, with expectations for continued acceleration [44] Question: Capital allocation priorities - Management emphasized a focus on geographic expansion and service enhancement within infrastructure, while remaining open to strategic acquisitions [50] Question: Market opportunity in manufacturing and high tech - Management believes the semiconductor market is in its early stages, with significant projects expected in the coming years [56]

February 26, 2026 Full Year and 4th Quarter 2025 EARNINGS CALL DISCLOSURE: 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 Securities Act of 1933 and the Securities Exchange Act of 1934. 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: ...

Core Insights - Sterling Infrastructure, Inc. (STRL) is set to report its fourth-quarter 2025 results on February 25, 2026, after market close [1] Financial Performance - In the last reported quarter, Sterling achieved adjusted earnings per share (EPS) of $3.48, exceeding the Zacks Consensus Estimate by 24.7% and marking a 58% increase year over year [2] - Revenues reached $689 million, surpassing estimates by 12.5% and reflecting a 32% year-over-year growth [2] - Gross margin expanded by 280 basis points to 24.7%, driven by a shift towards higher-margin projects [3] - Adjusted EBITDA increased by 47% compared to the same quarter last year, with healthy operating cash flow [3] Earnings Estimates - The Zacks Consensus Estimate for fourth-quarter EPS has risen to $2.66, indicating an 82.2% growth from the previous year [5] - Revenue estimates for the fourth quarter stand at $647.8 million, suggesting a 29.9% year-over-year increase [5] - For the full year 2025, revenues are expected to grow by 12.6%, while the bottom line is projected to increase by 71.3% [6] Segment Performance - The E-Infrastructure Solutions segment, which accounted for 60% of third-quarter revenues, is anticipated to be the primary growth driver, benefiting from strong demand for data center projects [13] - The Transportation Solutions segment, contributing 25% to total revenues, is expected to see a decline due to the planned wind-down of low-bid heavy highway operations in Texas, with revenues projected at $170 million, down 31.4% year over year [15][16] - The Building Solutions segment, making up 15% of total revenues, is expected to face mixed conditions, with residential activity under pressure but stable construction in key markets providing some support [17][18] Market Position and Valuation - Sterling's stock has increased by 49.4% over the past six months, outperforming the Zacks Engineering – R&D Services industry and the broader Construction sector [20] - The stock is currently trading at a forward P/E ratio of 32.8, which is a 25% premium to the industry average of 26.24 [22] - Compared to peers like AECOM, Fluor, and KBR, STRL appears overvalued, as these companies have lower forward P/E ratios [25] Outlook - The company is expected to report a resilient quarter, supported by strong demand in mission-critical infrastructure markets and disciplined project selection [26] - A solid backlog and healthy project pipeline are anticipated to provide revenue visibility [27] - However, challenges in the Transportation Solutions segment and residential softness in Building Solutions may limit upside potential [28]

Core Insights - Sterling Infrastructure, Inc. (STRL) has achieved significant margin expansion in its Transportation Solutions segment, shifting from a volume-driven model to one focused on disciplined project selection and higher-margin technical expertise [1][2] Financial Performance - Transportation Solutions segment revenues increased by 10% year over year, with adjusted operating profit rising by 40% and adjusted operating margins expanding by 335 basis points to 15.6% [1] - The segment ended the quarter with a backlog of $733 million, reflecting a 23% year-over-year increase [1] Strategic Transition - The ongoing wind-down of the low-bid heavy-highway business in Texas is identified as a key driver of margin improvement, with expectations of enhanced profitability as lower-margin projects are completed by the first half of 2026 [2] - Standardized processes and disciplined cost controls are helping to limit rework and schedule overruns, allowing for revenue scaling while expanding margins [2] Future Outlook - Sterling anticipates Transportation margins to remain structurally higher, forecasting operating margins of 13.5%-14% for 2025, up from 9.6% in 2024 [3] - The company expects continued growth in core markets and more than two years of backlog visibility, positioning the segment for stable and profitable growth [3][4] Competitive Landscape - Sterling operates in a competitive infrastructure construction market alongside larger firms such as MasTec, Inc. and EMCOR Group, Inc. [5] - MasTec's Pipeline Infrastructure segment has shown sequential EBITDA margin growth of 390 basis points to 15.4%, indicating potential for continued margin improvements [6] - EMCOR is a leading provider in electrical and mechanical construction, with significant exposure to mission-critical facilities [7] Stock Performance - STRL shares have gained 54.6% over the past six months, outperforming the Zacks Engineering - R and D Services industry, the broader Construction sector, and the S&P 500 Index [8] Earnings Estimates - STRL's earnings estimates for 2026 have increased to $12.21 from $11.95 per share, indicating a year-over-year growth of 16.8% [10] - Current earnings estimates for the current quarter and next quarter are $2.66 and $2.15, respectively, with the current year estimate at $10.45 [11] Valuation - STRL stock is currently trading at a forward 12-month price-to-earnings (P/E) ratio of 36.71, which is a premium compared to its industry peers [12]

Core Viewpoint - Sterling Infrastructure, Inc. is set to release its financial results for the fourth quarter and full year of 2025 on February 25, 2026, with a conference call scheduled for February 26, 2026, to discuss the results and outlook for 2026 [1]. Company Overview - Sterling operates through various subsidiaries across three segments: E-Infrastructure, Transportation, and Building Solutions, primarily in the Southern, Northeastern, Mid-Atlantic, Rocky Mountain regions, and the Pacific Islands [1]. - E-Infrastructure Solutions focus on large-scale site development and critical electrical services for data centers, semiconductor fabrication, and power generation [1]. - Transportation Solutions encompass infrastructure projects for highways, bridges, airports, and storm drainage systems [1]. - Building Solutions provide concrete foundations for residential and commercial properties, plumbing services, and surveys for new residential builds [1]. - The company emphasizes sustainability and responsible operations to enhance societal quality of life [1]. Conference Call Details - The conference call will take place at 9:00 am ET/8:00 am CT, and interested parties are encouraged to join by calling in ten minutes prior [1]. - A slide presentation will be available on the company's website during the call, and an archived version of the webcast will be accessible for thirty days [1].