Sterling vs. AECOM: Which Infrastructure Stock Deserves Your Capital?

The article compares Sterling Infrastructure (STRL) and AECOM (ACM) as infrastructure investment opportunities, concluding Sterling presents a stronger case due to its focus on high-value E-Infrastructure markets. Sterling reported Q2 2025 revenue growth of 21% and EPS growth of 41%, supported by a $2 billion backlog and upward EPS estimate revisions, leading to a raised 2025 guidance. In contrast, AECOM posted 6% net service revenue growth in 9M FY2025 with a $24.6 billion backlog but faces international market risks and has seen stable EPS estimates, positioning Sterling as the preferred growth play amidst accelerating infrastructure spending and recent Fed rate cuts.

Analysis

Sterling Infrastructure (STRL) is demonstrating superior growth and operational momentum compared to AECOM (ACM), positioning it as a more dynamic play within the infrastructure sector. STRL's Q2 2025 results were exceptionally strong, with revenue climbing 21% and adjusted EPS surging 41% year-over-year, driven by a 29% revenue increase in its high-demand E-Infrastructure segment focused on data centers. This performance is supported by robust forward-looking indicators, including a 24% year-over-year increase in total backlog to $2 billion, a raised 2025 guidance, and upward revisions to its consensus EPS estimates, which now project 56.9% growth for 2025. In contrast, AECOM presents a more stable but slower-growth profile, with net service revenues growing 6% in the first nine months of fiscal 2025. While its substantial $24.6 billion backlog provides long-term revenue visibility, the company faces headwinds from international market volatility and stagnant analyst earnings estimates. The market has clearly favored STRL's execution and growth trajectory, as reflected in its significant share price outperformance and a historically higher forward P/E multiple, a sentiment reinforced by a recent Federal Reserve rate cut which is expected to broadly stimulate infrastructure investment.

Key Decisions for Investors

• Given its strong execution, 41% EPS growth, and strategic focus on the high-demand data center market, investors seeking growth within the infrastructure sector should view Sterling Infrastructure (STRL) as a primary consideration.
• For AECOM (ACM), the stagnant earnings estimates and exposure to international market risks warrant a cautious approach; its large backlog offers stability, but its stock performance and growth profile significantly trail STRL's.
• Monitor STRL's Building Solutions segment, which saw a 1% revenue decline, as a potential offset to its E-Infrastructure strength, and consider the premium valuation as a trade-off for its superior growth prospects.