Sterling vs. Comfort Systems: Which Stock Wins on Data Center Growth?

Sterling Infrastructure Inc. STRL and Comfort Systems USA Inc. FIX are two infrastructure players well-positioned to benefit from the booming demand tied to data center development. Both companies are capitalizing on the rapid expansion of artificial intelligence (AI)-driven infrastructure needs, particularly the surge in large-scale data centers that power cloud computing and artificial intelligence applications.

Sterling specializes in advanced, large-scale site development services for data centers, manufacturing, distribution hubs, warehousing and power generation facilities. Meanwhile, Comfort Systems focuses on the complex mechanical, electrical and cooling systems that are essential for keeping these mission-critical facilities running efficiently. With the data center construction cycle accelerating, both companies are increasingly pursuing growth opportunities in this space.

However, tariff-related cost pressures and potential volatility in hyperscaler capital expenditure pose risks to both businesses. Rising construction costs or shifts in economic policy may hurt customer investment plans, impacting project pipelines and profit margins. Navigating these uncertainties will be key as both companies pursue growth in the data center space.

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

The Case for STRL

This Texas-based provider of e-infrastructure solutions, building solutions and transportation solutions is steadily growing its E-Infrastructure platform, supported by strong project execution, disciplined bidding and deep customer relationships. Sterling’s ability to deliver complex, mission-critical projects efficiently has made it a go-to partner for large-scale data center developments.

In the first quarter of 2025, Sterling’s E-Infrastructure Solutions revenues rose 18% year over year, with adjusted operating income surging 61% and margins expanding more than 600 basis points to 23%. A key growth driver is the company’s deepening involvement in AI-driven data centers, which now make up above 65% of its E-Infrastructure backlog.

With E-Infrastructure projects having increasing strategic focus, sustained data center demand appears to be a key driver supporting the company’s margin strength. At the end of the first quarter, the company's total backlog was $2.1 billion. The gross margin of the backlog reached 17.7%, up 100 basis points (bps) from 16.7% at the end of 2024. The improvement was driven by a higher E-Infrastructure backlog and its margin growth, with E-Infrastructure Solutions accounting for approximately 57% of the total backlog. This strong position is expected to support Sterling’s growth trajectory through 2025 and beyond.

On June 17, 2025, Sterling strengthened its E-Infrastructure platform by announcing the acquisition of CEC Facilities Group, a specialty electrical and mechanical contractor focused on data centers, semiconductor facilities and advanced manufacturing. The acquisition is set to significantly enhance Sterling’s service capabilities across the project lifecycle, providing access to maintenance and upgrade opportunities in addition to new construction. The addition of CEC broadens Sterling’s customer base and geographic reach, particularly in Texas — a key market for data center and semiconductor expansion. (Read more: Sterling Expands E-Infrastructure Platform With CEC Buyout, Stock Up)

Sterling expects mid-to-high teens revenue growth for its E-Infrastructure segment in 2025, with margins in the mid-20% range. The company’s visibility into multi-year projects, supported by structural trends in AI, e-commerce and onshoring, suggests that it is well-positioned to benefit from continued investment in digital infrastructure. Management remains focused on pursuing high-return opportunities and leveraging its expanded platform to support sustained growth through 2026 and beyond.

The Case for FIX

Comfort Systems is experiencing sustained growth in demand tied to data center development, supported by strong project bookings, expanding customer relationships and deepening technology capabilities. The company’s specialized expertise in delivering complex mechanical and electrical systems positions it as a trusted partner for mission-critical infrastructure in the technology sector.

In the first quarter of 2025, Comfort Systems reported record earnings per share of $4.75, surging more than 75% year over year, with revenues climbing 19% to $1.83 billion. This growth was largely driven by advanced technology projects, including data centers and semiconductor facilities, which now account for 37% of Comfort Systems’ total revenues, up from 30% a year ago. The company’s disciplined project management, operational efficiency and customer-centric execution continue to support its strong financial performance.

As of March 31, 2025, the company’s backlog reached a record $6.9 billion, with the same-store backlog increasing both sequentially and year over year. Management emphasized sustained demand from technology and industrial sectors, with large, complex projects continuing to strengthen the growth pipeline. Comfort Systems’ consistent execution of demanding technology-driven assignments solidifies its competitive position in the fast-growing data center infrastructure space.

The company is also investing in modular construction capacity, an initiative that is expected to enhance execution speed and scalability — key requirements for today’s rapidly expanding data center market. Management remains optimistic about continued growth, supported by a strong technology pipeline, record backlog and persistent demand for complex infrastructure projects. 

Comfort Systems expects stable performance through 2025 and sees positive momentum carrying into 2026, particularly as onshoring trends and AI-driven infrastructure investment continue to grow.

Price Performance & Valuations for STRL, FIX Stocks

Sterling’s stock has gained 29.4% in the year-to-date period, outperforming the broader Construction sector’s 4.3% fall. Meanwhile, Comfort Systems shares have risen 17.9% in the same time.

Considering valuation, Sterling is trading below Comfort Systems on a forward 12-month price-to-earnings (P/E) ratio basis.

Comparing EPS Projections: STRL & FIX

The 2025 EPS estimates have trended upward over the past 30 days for FIX stock, while the same has been unchanged for STRL. The Zacks Consensus Estimate for STRL’s 2025 bottom line suggests a 41.2% improvement, while that for FIX indicates a year-over-year increase of 32.1%.

For FIX Stock

For STRL Stock

Conclusion

The strong demand for data center infrastructure, artificial intelligence and semiconductor projects is creating growth opportunities for Sterling and Comfort Systems. Both companies are well-positioned to benefit from the multi-year investment cycle reshaping the infrastructure landscape.

Comfort Systems appears better positioned in the near term, supported by its record backlog, expanding technology exposure and faster project delivery capabilities. Sterling offers a solid long-term growth story, driven by its expanding E-Infrastructure platform and the strategic acquisition of CEC Facilities Group.

When weighing both options, Comfort Systems — a Zacks Rank #1 (Strong Buy) company — currently stands out as the better investment for 2025, backed by operational strength, earnings momentum and a well-diversified growth pipeline. Sterling — a Zacks Rank #2 (Buy) company — presents a solid long-term opportunity with an attractive valuation, but its near-term earnings visibility is not as strong as Comfort Systems at this stage, which is depicted by the muted earnings estimate revision trend.

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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