Sterling Infrastructure, Inc. (STRL) DCF Valuation
Why we don't show a single “fair value” for STRL
Even the optimistic scenario of a conservative trailing-FCF model ($299.79) sits far below today's price — the market is paying for growth and durability beyond what this model structure captures. The honest lens is the question below: what growth does today's price actually require? The model scenarios are listed further down for reference.
What would today's price require?
$892.25 is justified only if free cash flow grows about +52.4% a year (fading to 2.5% long-run) at a 11.5% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 11.8%/yr | 12.5% | $188.63 |
| Base case | 14.8%/yr | 11.5% | $235.89 |
| Optimistic | 17.8%/yr | 10.5% | $299.79 |
| Analyst DCF (FMP) | independent reference — different model | $252.83 | |
Current Price
$892.25
Market-Implied Growth
+52.4%/yr
vs +14.8% 5Y actual
Base-Case Model Value
$235.89
model output — not a price target
STRL DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for STRL (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $388.4M · 0.03B shares · net cash $99.7M
Estimated Fair Value
$345.37
-61.3% vs $892.25
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 14.8%/yr FCF growth and 10-year horizon fixed. Green = above today's $892.25; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 9.5% | $427 | $445 | $466 | $491 | $519 |
| 10.5% | $369 | $383 | $398 | $415 | $435 |
| 11.5% | $324 | $334 | $345 | $358 | $372 |
| 12.5% | $288 | $296 | $304 | $313 | $323 |
| 13.5% | $258 | $264 | $270 | $277 | $285 |
About Sterling Infrastructure, Inc.
Sterling Infrastructure, Inc. operates across three distinct business segments: transportation, e-infrastructure, and building solutions. The company's operations span a significant portion of the United States, including the Southern, Northeastern, and Mid-Atlantic regions, as well as the Rocky Mountain states, California, and Hawaii. Within its transportation division, Sterling specializes in developing and rehabilitating critical infrastructure. This includes projects such as highways, roads, bridges, airports, ports, and light rail systems, alongside essential water, wastewater, and storm drainage solutions. Their clients in this sector range from state departments of transportation and regional transit authorities to airport, port, and water authorities, as well as railway companies. Furthermore, Sterling delivers specialized site infrastructure development services. These projects cater to high-profile "blue-chip" clients operating within the e-commerce, data center, distribution and warehousing, and energy industries. The building solutions segment focuses on concrete work for both residential and commercial applications. This encompasses foundations for single-family and multi-family residences, as well as parking structures, elevated slabs, and other custom concrete projects. Their client base here includes national, regional, and custom home builders, as well as developers and general contractors in the commercial sector. Originally established in 1955, the company operated as Sterling Construction Company, Inc. until its renaming to Sterling Infrastructure, Inc. in June 2022. Its corporate headquarters are located in The Woodlands, Texas.
- Sector
- Industrials
- Industry
- Engineering & Construction
- CEO
- Joseph A. Cutillo