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Sterling Construction (STRL) Stock Jumps 8.6%: Will It Continue to Soar?
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Sterling Construction (STRL - Free Report) shares rallied 8.6% in the last trading session to close at $24.13. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 4.6% loss over the past four weeks.
Sterling witnessed a solid price appreciation, following the announcement of amended existing credit agreement with its lending group to modify various aspects of the deal. Per the recent modification, interest rates on the Credit Agreement borrowings have reduced by 2 percentage points. Also, prospective mandatory quarterly payments have reduced to $4.1 million from $12.5 million.
Sterling’s Chief Executive Officer, Joe Cutillo, said, "This amendment significantly enhances our prospective financial performance in that we expect our pre-tax interest expense to decline by approximately $1.6 million per quarter for the balance of 2021. Additionally, the lowering of our required mandatory quarterly payments will enhance our ability to invest in the growth of our business."
This civil construction company is expected to post quarterly earnings of $0.53 per share in its upcoming report, which represents a year-over-year change of -18.5%. Revenues are expected to be $403.3 million, up 0.8% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Sterling Construction, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on STRL going forward to see if this recent jump can turn into more strength down the road.
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Sterling Construction (STRL) Stock Jumps 8.6%: Will It Continue to Soar?
Sterling Construction (STRL - Free Report) shares rallied 8.6% in the last trading session to close at $24.13. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 4.6% loss over the past four weeks.
Sterling witnessed a solid price appreciation, following the announcement of amended existing credit agreement with its lending group to modify various aspects of the deal. Per the recent modification, interest rates on the Credit Agreement borrowings have reduced by 2 percentage points. Also, prospective mandatory quarterly payments have reduced to $4.1 million from $12.5 million.
Sterling’s Chief Executive Officer, Joe Cutillo, said, "This amendment significantly enhances our prospective financial performance in that we expect our pre-tax interest expense to decline by approximately $1.6 million per quarter for the balance of 2021. Additionally, the lowering of our required mandatory quarterly payments will enhance our ability to invest in the growth of our business."
This civil construction company is expected to post quarterly earnings of $0.53 per share in its upcoming report, which represents a year-over-year change of -18.5%. Revenues are expected to be $403.3 million, up 0.8% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Sterling Construction, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on STRL going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank 2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>