Sterling Construction (NASDAQ:STRL) has garnered its first analyst coverage from Cantor Fitzgerald, which assigned an Overweight rating and established a $413 price target as of Friday. The company’s shares are currently priced at approximately $364.25, bringing its market capitalization to $11.19 billion. Sterling Construction has delivered a notable total return of 85.29% over the past year.
Analyst Manish Somaiya of Cantor Fitzgerald characterizes Sterling as a "transformed infrastructure contractor" that has effectively redirected its business portfolio towards mission-critical, higher-margin sectors such as data centers, semiconductors, and advanced manufacturing. This strategic shift has bolstered Sterling's financial position, earning it a "GREAT" attribution in the InvestingPro scoring system.
More than 80% of Sterling's current project backlog is concentrated in E-Infrastructure, a focus area that supports continuous margin enhancement, robust free cash generation, and returns that rank among the best in the public Engineering and Construction (E&C) space.
The firm’s acquisition of Consolidated Electrical Contractors (CEC) has strengthened Sterling’s integrated site development and electrical service offerings. This move expands the company's project capabilities, optimizes sequencing efficiency, and is expected to generate incremental margin synergies over time.
Management’s ongoing commitment to selective project acquisition and execution, with a priority for large-scale, complex assignments, underpins the company’s profitability strategy and market positioning.
Recent corporate developments include Sterling Construction's reported 2025 third-quarter earnings per share (EPS) of $3.48, surpassing analyst expectations of $2.84. Revenue reached $689 million, exceeding the forecasted $618.8 million, signaling robust operational performance. Concurrently, Sterling Infrastructure introduced a new $400 million stock repurchase initiative effective immediately, superseding the prior plan with $81 million remaining capacity, set to unfold over the next two years.
Additionally, William Blair has reaffirmed its Outperform rating on Sterling Construction, emphasizing the company’s robust foothold in the southeastern U.S. data center market, particularly in Atlanta. The firm's ability to complete projects ahead of schedule has facilitated entry into new markets, evidencing Sterling’s strategic growth momentum.
These insights garnered from analyst evaluations and recent financial disclosures underscore Sterling Construction's evolving market leadership, strategic initiatives, and strong financial execution within critical infrastructure sectors.