Sterling Infrastructure (NASDAQ:STRL) and Stantec (NYSE:STN) Financial Comparison

Stantec (NYSE:STN) and Sterling Infrastructure (NASDAQ:STRL) are both mid-cap industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, profitability, risk, analyst recommendations, institutional ownership, dividends and earnings.

Institutional and Insider Ownership

63.9% of Stantec shares are owned by institutional investors. Comparatively, 80.9% of Sterling Infrastructure shares are owned by institutional investors. 0.5% of Stantec shares are owned by insiders. Comparatively, 1.6% of Sterling Infrastructure shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Stantec and Sterling Infrastructure’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stantec	6.10%	20.61%	8.53%
Sterling Infrastructure	12.85%	45.97%	19.94%

Volatility and Risk

Stantec has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500. Comparatively, Sterling Infrastructure has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500.

Earnings & Valuation

This table compares Stantec and Sterling Infrastructure”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stantec	$5.83 billion	1.62	$343.11 million	$3.21	26.71
Sterling Infrastructure	$2.49 billion	3.58	$290.15 million	$17.82	16.41

Stantec has higher revenue and earnings than Sterling Infrastructure. Sterling Infrastructure is trading at a lower price-to-earnings ratio than Stantec, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Stantec and Sterling Infrastructure, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stantec	0	2	5	0	2.71
Sterling Infrastructure	0	2	7	0	2.78

Stantec presently has a consensus target price of $175.00, indicating a potential upside of 104.14%. Sterling Infrastructure has a consensus target price of $709.14, indicating a potential upside of 142.53%. Given Sterling Infrastructure’s stronger consensus rating and higher probable upside, analysts plainly believe Sterling Infrastructure is more favorable than Stantec.

Summary

Sterling Infrastructure beats Stantec on 11 of the 14 factors compared between the two stocks.

About Stantec

Stantec is a global professional services firm that provides engineering, architecture, environmental consulting, and related services. Its work supports the planning, design, and delivery of projects in areas including water, transportation, buildings, energy, and community development. Founded in Edmonton, Alberta, in 1954 as D.R. Stanley Associates, the company later adopted the Stantec name. It is headquartered in Edmonton and serves public- and private-sector clients across North America and in international markets.

About Sterling Infrastructure

Sterling Infrastructure, Inc. (NASDAQ: STRL) is a U.S.-based construction company that delivers infrastructure and building services through its E-Infrastructure Solutions, Transportation Solutions and Building Solutions segments. E-Infrastructure Solutions provides site development and related services for data centers, manufacturing facilities, distribution centers and other large-scale projects. Transportation Solutions builds and improves public infrastructure, including roads and bridges, while Building Solutions focuses on concrete foundations and other construction services for residential and commercial customers.