Sterling vs. Primoris: Which Infrastructure Stock is the Better Buy?

Firms like Sterling Infrastructure, Inc. STRL and Primoris Services Corporation PRIM are currently gaining on the growing demand for infrastructure solutions in the United States, across mission-critical projects, including power generation, electric utility and data centers.

Sterling is currently focusing on diversifying its revenue stream by capitalizing on the robust trends across public infrastructure, especially by works related to mission-critical data centers and manufacturing. Primoris, on the other hand, is positioning itself for outbound exploration in the public infrastructure market and strengthening its earnings potential in the process.

Despite the ongoing tariff-related uncertainties, the public infrastructure spending is at its peak, most likely due to the country’s aim of enhancing supply-chain resilience and boosting domestic manufacturing.  The ongoing tailwinds are proving incremental for their backlog growth trends, solidifying long-term revenue visibility and profitability structure.

Let’s dive deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.

The Case for Sterling Stock

This Texas-based infrastructure services provider is making a strategic shift toward large mission-critical projects due to the ongoing housing market weakness in the country. It has been focusing on disciplined bidding, smart project selection and efficient execution to strengthen its role as a trusted partner for large, mission-critical developments, from major highways and aviation infrastructure to Artificial Intelligence (AI)-driven data centers and industrial sites.

As of June 30, 2025, E-Infrastructure Solutions’ backlog was up year over year by 44% to $1.2 billion, with major contributors being mission-critical projects, including data centers and manufacturing. Besides, during the first six months of 2025, revenues in the E-Infrastructure Solutions segment grew year over year by 24.2% to $528.7 million, contributing 51% to the company’s total revenues. Sterling’s total backlog as of June 30, 2025, was $2.01 billion with a margin on backlog of 17.8%, up from $1.69 billion at 2024-end, with a backlog margin of 16.7%.

Adding to these favorable trends surrounding public infrastructure demand comes STRL’s recent agreement to acquire CEC Facilities Group, LLC (expected to close by the third quarter of 2025). This Texas-based specialty electrical and mechanical contractor is expected to amplify the capabilities of STRL across mission-critical electrical and mechanical services across existing and new markets, like Texas.

The synergies from the acquisition of CEC Facilities, coupled with the robust market trends for public infrastructure demand, are expected to favorably outweigh the housing market softness in 2025 and beyond, boosting Sterling’s prospects.

The Case for Primoris Stock

Primoris’ expertise mainly lies in constructing utility-scale power generation resources and infrastructure supporting the transmission and distribution of power. With the demand trend for data center infrastructure going strong currently, the company is looking for opportunities and acting on them to expand its market exposure. Total backlog as of June 30, 2025, increased 10% to $11.49 billion from $10.45 billion a year ago.

Recently, PRIM highlighted the evaluation process for about $1.7 billion of work related to data centers, which it expects to receive contracts for by the end of 2025. These projects include solutions across early-stage site preparation, power generation, utility infrastructure and fiber network construction. This prospective multi-year opportunity is expected to boost the company’s revenue visibility as well as expand its market exposure toward new project possibilities in the future. As of the second quarter of 2025, it had been planning to submit bids for more than $2.5 billion in natural gas generation projects for the upcoming years, alongside about $20-$30 billion worth of solar projects planned through 2028.

Currently, only 10% of PRIM’s revenues are directly tied to data center projects; thus, with efficient execution and prospective contract wins, the company will be able to boost its profitability structure and diversify revenue streams.

Stock Performance & Valuation

As witnessed from the chart below, in the past three months, Primoris’ share price performance stands above Sterling’s when compared with the broader Construction sector.

Considering valuation, over the last five years, Sterling is trading above Primoris on a forward 12-month price-to-earnings (P/E) ratio basis.

Overall, from these technical indicators, it can be deduced that PRIM stock offers an incremental growth trend with a discounted valuation, while STRL stock offers a slow growth trend with a premium valuation.

Comparing EPS Estimate Trends: STRL vs. PRIM

The Zacks Consensus Estimate for STRL’s 2025 EPS indicates 45.9% year-over-year growth, with the 2026 estimate indicating an increase of 9.4%. The 2025 and 2026 EPS estimates have trended upward over the past 30 days.

STRL's EPS Trend

The Zacks Consensus Estimate for PRIM’s 2025 and 2026 earnings estimates implies year-over-year improvements of 20.7% and 12.1%, respectively. Its 2025 and 2026 EPS estimates have trended upward over the past 30 days.

PRIM's EPS Trend

Is It STRL or PRIM?

Based on the discussion above, Sterling’s strategy of focusing on mission-critical projects, coupled with its strong backlog growth and the planned CEC Facilities acquisition, reinforces long-term visibility. However, its premium valuation suggests the market has already priced in much of this optimism.

On the other hand, Primoris, with a significantly larger backlog and pipeline in solar projects through 2028, is expanding aggressively into high-growth markets like data centers and renewables.

While the earnings estimates for STRL, carrying a Zacks Rank #2 (Buy) at present, are projected to grow faster in 2025, PRIM, which sports a Zacks Rank #1 (Strong Buy), trades at a more attractive valuation and offers steadier multi-year growth catalysts. Given the stronger relative share performance, discounted valuation trend and expanding exposure to secular growth markets, PRIM currently presents the more compelling buy opportunity. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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