NasdaqGS:STRL

Stock Analysis Report

Sterling Construction Company

Executive Summary

Sterling Construction Company, Inc., together with its subsidiaries, operates as a heavy civil and residential construction company in Arizona, California, Colorado, Hawaii, Nevada, Texas, Utah, and other states in the United States.

Snowflake

Fundamentals

Undervalued with proven track record.

Risks

  • Sterling Construction Company has significant price volatility in the past 3 months.
  • Sterling Construction Company is covered by less than 3 analysts.

Similar Companies

Share Price & News

How has Sterling Construction Company's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.5%

NasdaqGS:STRL

-2.7%

US Construction

-1.0%

US Market


1 Year Return

-27.8%

NasdaqGS:STRL

-12.8%

US Construction

-0.4%

US Market

STRL underperformed the Construction industry which returned -13.4% over the past year.

STRL underperformed the Market in United States of America which returned -1.7% over the past year.


Share holder returns

STRLIndustryMarket
7 Day0.5%-2.7%-1.0%
30 Day-11.7%-9.2%-3.3%
90 Day-7.9%-3.5%0.4%
1 Year-27.8%-27.8%-12.1%-12.8%1.8%-0.4%
3 Year67.8%67.8%8.2%5.9%39.4%30.4%
5 Year25.4%25.4%-0.8%-4.0%54.2%37.1%

Price Volatility Vs. Market

How volatile is Sterling Construction Company's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sterling Construction Company undervalued based on future cash flows and its price relative to the stock market?

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Sterling Construction Company's share price is below the future cash flow value, and at a moderate discount (> 20%).

Sterling Construction Company's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Sterling Construction Company is good value based on earnings compared to the US Construction industry average.

Sterling Construction Company is good value based on earnings compared to the United States of America market.


Price Based on Expected Growth

Sterling Construction Company is good value based on expected growth next year.


Price Based on Value of Assets

Sterling Construction Company is overvalued based on assets compared to the US Construction industry average.


Next Steps

Future Growth

How is Sterling Construction Company expected to perform in the next 1 to 3 years based on estimates from 2 analysts?

34.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Sterling Construction Company's revenue is expected to grow by 6% yearly, however this is not considered high growth (20% yearly).

Sterling Construction Company's earnings are expected to grow significantly at over 20% yearly.

Sterling Construction Company's revenue growth is positive but not above the United States of America market average.

Sterling Construction Company's earnings growth is expected to exceed the United States of America market average.

Sterling Construction Company's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Sterling Construction Company will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has Sterling Construction Company performed over the past 5 years?

68.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Sterling Construction Company has delivered over 20% year on year earnings growth in the past 5 years.

Sterling Construction Company's 1-year earnings growth is less than its 5-year average (15.8% vs 68.7%)

Sterling Construction Company's earnings growth has exceeded the US Construction industry average in the past year (15.8% vs 0.6%).


Return on Equity

Sterling Construction Company has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Sterling Construction Company used its assets more efficiently than the US Construction industry average last year based on Return on Assets.


Return on Capital Employed

Sterling Construction Company has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Sterling Construction Company's financial position?


Financial Position Analysis

Sterling Construction Company is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Sterling Construction Company's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Sterling Construction Company's level of debt (44.5%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (13.6% vs 44.5% today).

Debt is well covered by operating cash flow (55.4%, greater than 20% of total debt).

Interest payments on debt are not well covered by earnings (EBIT is 2.7x annual interest expense, ideally 3x coverage).


Balance Sheet

Low level of unsold assets.

Debt is covered by short term assets, assets are 4x debt.


Next Steps

Dividend

What is Sterling Construction Company's current dividend yield, its reliability and sustainability?


Dividend Yield and Payments Analysis

Unable to evaluate Sterling Construction Company's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.

Unable to evaluate Sterling Construction Company's dividend against the top 25% market benchmark as the company has not reported any payouts.

Unable to perform a dividend volatility check as Sterling Construction Company has not reported any payouts.

Unable to verify if Sterling Construction Company's dividend has been increasing as the company has not reported any payouts.


Current Payout to Shareholders

Unable to calculate sustainability of dividends as Sterling Construction Company has not reported any payouts.


Future Payout to Shareholders

Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.


Next Steps

Management

What is the CEO of Sterling Construction Company's salary, the management and board of directors tenure and is there insider trading?

2.3yrs

Average management tenure


CEO

Joe Cutillo (53yo)

2.3yrs

Tenure

US$8,308,461

Compensation

Mr. Joseph A. Cutillo, also known as Joe, has been the President of Sterling Construction Company, Inc. since February, 2017 and has been its Chief Executive Officer and Director since April 28, 2017. Mr.  ...


CEO Compensation Analysis

Joe's remuneration is higher than average for companies of similar size in United States of America.

Joe's compensation has increased by more than 20% in the past year whilst earnings grew less than 20%.


Management Age and Tenure

2.3yrs

Average Tenure

60yo

Average Age

The tenure for the Sterling Construction Company management team is about average.


Board Age and Tenure

2.3yrs

Average Tenure

62yo

Average Age

The average tenure for the Sterling Construction Company board of directors is less than 3 years, this suggests a new board.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

BuyUS$119,40010 May 19
Roger Cregg
EntityIndividual
Role
Member of the Board of Directors
Shares10,000
Max PriceUS$11.94

Ownership Breakdown


Management Team

  • Richard Chandler (62yo)

    Executive VP

    • Tenure: 1.8yrs
    • Compensation: $1.65m
  • Ron Ballschmiede (63yo)

    Executive VP

    • Tenure: 3.9yrs
    • Compensation: $3.65m
  • Con Wadsworth (58yo)

    Executive VP & COO

    • Tenure: 3.4yrs
    • Compensation: $1.42m
  • Kevan Blair

    Senior Vice President of Corporate Finance

    • Tenure: 5.9yrs
    • Compensation: $415.15k
  • Jennifer Maxwell

    Director of Investor Relations

  • Joe Cutillo (53yo)

    CEO, President & Director

    • Tenure: 2.3yrs
    • Compensation: $8.31m
  • Craig Allen

    Senior VP and Chief Compliance & Administration Officer

    • Tenure: 0.6yrs
    • Compensation: $499.61k
  • Kate Sberna

    VP & Chief Talent Officer

    • Tenure: 0.6yrs

Board Members

  • Roger Cregg (63yo)

    Director

    • Tenure: 0.3yrs
  • Milton Scott (62yo)

    Chairman of the Board

    • Tenure: 4.4yrs
    • Compensation: $274.58k
  • Marian Davenport (65yo)

    Independent Director

    • Tenure: 5.6yrs
    • Compensation: $171.75k
  • Tom White (62yo)

    Independent Director

    • Tenure: 1.1yrs
    • Compensation: $90.35k
  • Charles Patton (60yo)

    Director

    • Tenure: 6.2yrs
    • Compensation: $156.58k
  • Ray Messer (71yo)

    Director

    • Tenure: 2.3yrs
    • Compensation: $163.42k
  • Dana O’Brien (51yo)

    Director

    • Tenure: 0.6yrs
  • Joe Cutillo (53yo)

    CEO, President & Director

    • Tenure: 2.3yrs
    • Compensation: $8.31m

Company Information

Sterling Construction Company, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sterling Construction Company, Inc.
  • Ticker: STRL
  • Exchange: NasdaqGS
  • Founded: 1955
  • Industry: construction and engineering
  • Sector: capital goods
  • Market Cap: US$292.721m
  • Shares outstanding: 26.47m
  • Website: Click here

Number of Employees


Location

  • Sterling Construction Company, Inc.
  • 1800 Hughes Landing Boulevard
  • Suite 250
  • The Woodlands
  • Texas
  • 77380
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
STRLNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 1991
UAODB (Deutsche Boerse AG)YesCommon StockDEEURJul 1991

Biography

Sterling Construction Company, Inc., together with its subsidiaries, operates as a heavy civil and residential construction company in Arizona, California, Colorado, Hawaii, Nevada, Texas, Utah, and other  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/16 23:46
End of Day Share Price2019/08/16 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.