As you might know, Sterling Infrastructure, Inc. (NASDAQ:STRL) just kicked off its latest quarterly results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 4.1% to hit US$583m. Sterling Infrastructure reported statutory earnings per share (EPS) US$1.67, which was a notable 17% above what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the current consensus from Sterling Infrastructure's twin analysts is for revenues of US$2.17b in 2024. This would reflect an okay 4.8% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 7.0% to US$5.66. In the lead-up to this report, the analysts had been modelling revenues of US$2.18b and earnings per share (EPS) of US$5.19 in 2024. So the consensus seems to have become somewhat more optimistic on Sterling Infrastructure's earnings potential following these results.
The consensus price target was unchanged at US$140, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sterling Infrastructure's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Sterling Infrastructure's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 9.8% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.9% annually. So it's pretty clear that, while Sterling Infrastructure's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Sterling Infrastructure following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.
You can also see our analysis of Sterling Infrastructure's Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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