Jim Cramer’s Lightning Rounds: 12 Stocks Under the Spotlight

7. Sterling Infrastructure, Inc. (NASDAQ:STRL)

Number of Hedge Fund Holders: 30

When asked about Sterling Infrastructure, Inc. (NASDAQ:STRL), Cramer said:

“This stock’s up 120%. Now I will tell you, Sterling infrastructure… It is living off, I think, a lot of the federal money that’s been spent. So, I don’t want to get greedy… Take some off the table and let the rest run.”

Sterling Infrastructure (NASDAQ:STRL) provides a range of services, including site development for e-commerce, data centers, and power generation, infrastructure projects for transportation systems, and concrete foundations and plumbing services for residential and commercial buildings. It works with federal, state, and municipal governments, particularly state Departments of Transportation (DOTs) and other regional authorities overseeing airports, ports, water systems, and railroads.

Four state DOTs accounted for half of the segment’s revenue in 2023, a slight increase from 44% in 2022 and 42% in 2021. In the third-quarter earnings call, management highlighted that the company is currently in the second half of the federal funding cycle for transportation projects. They mentioned that the company has built up a backlog of over two years and continues to see strong activity in the sector.

Management believes that the company is positioned in a market environment that supports sustained growth above historical levels, assuming margins hold steady or improve. In addition to its transportation work, Sterling Infrastructure (NASDAQ:STRL) continues to benefit from the growing demand for hyperscale data center development.

Earlier this year, its subsidiary, Plateau Excavation, was awarded a data center project in the southeastern U.S., valued at approximately $100 million. The project includes 280 acres of site work, with 125,000 linear feet of underground infrastructure installation.