Sterling Infrastructure (STRL) Registers a Bigger Fall Than the Market: Important Facts to Note

Sterling Infrastructure (STRL) closed at $222.54 in the latest trading session, marking a -3.55% move from the prior day. The stock's change was less than the S&P 500's daily loss of 0.11%. At the same time, the Dow added 0.91%, and the tech-heavy Nasdaq lost 0.82%.

Prior to today's trading, shares of the civil construction company had gained 21.69% outpaced the Construction sector's gain of 3.97% and the S&P 500's gain of 5.17%.

The upcoming earnings release of Sterling Infrastructure will be of great interest to investors. It is anticipated that the company will report an EPS of $2.26, marking a 35.33% rise compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $555.13 million, showing a 4.75% drop compared to the year-ago quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $8.61 per share and revenue of $2.09 billion, indicating changes of +41.15% and -1.22%, respectively, compared to the previous year.

Investors should also note any recent changes to analyst estimates for Sterling Infrastructure. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Currently, Sterling Infrastructure is carrying a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that Sterling Infrastructure has a Forward P/E ratio of 26.81 right now. This denotes a premium relative to the industry average Forward P/E of 20.46.

It's also important to note that STRL currently trades at a PEG ratio of 1.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Engineering - R and D Services was holding an average PEG ratio of 1.76 at yesterday's closing price.

The Engineering - R and D Services industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 97, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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