Civil infrastructure construction company Sterling Infrastructure (NASDAQ:STRL) will be announcing earnings results tomorrow after market close. Here’s what to expect.
Sterling missed analysts’ revenue expectations by 2.3% last quarter, reporting revenues of $593.7 million, up 6% year on year. It was a strong quarter for the company, with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ EPS estimates.
Is Sterling a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Sterling’s revenue to grow 9.3% year on year to $531.3 million, in line with the 8.3% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.33 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Sterling has missed Wall Street’s revenue estimates three times over the last two years.
Looking at Sterling’s peers in the construction and engineering segment, some have already reported their Q4 results, giving us a hint as to what we can expect. AECOM delivered year-on-year revenue growth of 2.9%, missing analysts’ expectations by 2.3%, and Construction Partners reported revenues up 41.6%, topping estimates by 9.7%. AECOM’s stock price was unchanged after the results, while Construction Partners was down 3.6%.
Read our full analysis of AECOM’s results here and Construction Partners’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the construction and engineering stocks have shown solid performance, the group has generally underpeformed, with share prices down 5.8% on average over the last month. Sterling is down 16.9% during the same time and is heading into earnings with an average analyst price target of $194.33 (compared to the current share price of $117.82).
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