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These Highly Ranked Construction Sector Stocks Could March Higher This Month
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With the busy spring home-buying season approaching the Zacks Construction sector is currently ranked second out of 16 Zacks sectors. Many of the Zacks Subindustries within the sector are benefitting from strengthening operating environments.
To that point, the Zacks Building Products-Home Builders Industry is currently in the top 6% of over 250 Zacks industries. Furthermore, the Zacks Building Products-Heavy Construction Industry and the Zacks Engineering-R and D Services Industry are both in the top 33% of all Zacks industries.
More intriguing is that quite a few of these Construction sector stocks belong to the coveted Zacks Rank #1 (Strong Buy) list. Standing out in terms of growth and their reasonable valuations here are a few of these highly-ranked Zacks Construction sector stocks to consider.
The Top-Rated Building Products-Home Builders Industry
Toll Brothers (TOL - Free Report) stock has headlined home builders who have been able to sustain the growth the broader industry saw from high demand following the pandemic. Toll Brothers was named the world’s most admired homebuilder for a third consecutive year by Fortune Magazine as a leading builder of luxury homes in the United States. Over the last five years, Toll Brothers earnings have catapulted 207% from $4.03 a share in 2019 to $12.36 per share in 2023. This has exceeded the Zacks Building Products-Home Builders Industiry's historic EPS growth rate of 35%. Plus, Toll Brothers' annual earnings are expected to rise another 8% in fiscal 2024 which tops the industry’s anticipated average of 2.65% EPS growth and the S&P 500's 6.5%. More compelling is that Toll Brothers stock has soared +98% in the last year but still trades at just 8.7X forward earnings.
Image Source: Zacks Investment Research
Dream Finder Homes (DFH - Free Report) and Century Communities (CCS - Free Report) are two other homebuilders that have advantageous top and bottom-line expansion on the horizon. Both are expecting double-digit growth in this regard for FY24 with Dream Finder Home’s stock soaring +213% over the last year and trading at 12.2X forward earnings while Century Communities' shares have risen +47% and still trade at 8.6X.
EMCOR Group and Sterling Infrastructure’s expansion are standing out among the Zacks Building Products-Heavy Construction Industry and the Zacks Engineering-R and D Services Industry respectively.
As one of the leading providers of mechanical and electrical construction, EMCOR’s growth has been monstrous in recent years with EMC shares soaring +97% over the last year but trading at a reasonable 24X forward earnings multiple. EMCOR’s 132% EPS growth over the last five years is very impressive with annual earnings expected to be virtually flat in FY24 but rise 4% in FY25 to $13.91 per share.
Image Source: Zacks Investment Research
Meanwhile, Sterling Infrastructure is in the midst of its expansion as an E-Infrastructure, building, and transportation solutions provider. Sterling Infrastructure's stock has skyrocketed +175% in the last year with annual earnings and sales expected to rise 11% respectively to $4.98 per share and $2.2 billion. Sterling Infrastructure is expected to post double-digit growth on its top and bottom lines in FY25 as well and trades at 22.2X forward earnings and 1.7X sales.
Image Source: Zacks Investment Research
Bottom Line
Most compelling and indicative that the strong price performances of these Zacks Construction sector stocks could continue is that earnings estimate revisions for their FY24 and FY25 have continued to trend higher making now an ideal time to buy.
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These Highly Ranked Construction Sector Stocks Could March Higher This Month
With the busy spring home-buying season approaching the Zacks Construction sector is currently ranked second out of 16 Zacks sectors. Many of the Zacks Subindustries within the sector are benefitting from strengthening operating environments.
To that point, the Zacks Building Products-Home Builders Industry is currently in the top 6% of over 250 Zacks industries. Furthermore, the Zacks Building Products-Heavy Construction Industry and the Zacks Engineering-R and D Services Industry are both in the top 33% of all Zacks industries.
More intriguing is that quite a few of these Construction sector stocks belong to the coveted Zacks Rank #1 (Strong Buy) list. Standing out in terms of growth and their reasonable valuations here are a few of these highly-ranked Zacks Construction sector stocks to consider.
The Top-Rated Building Products-Home Builders Industry
Toll Brothers (TOL - Free Report) stock has headlined home builders who have been able to sustain the growth the broader industry saw from high demand following the pandemic. Toll Brothers was named the world’s most admired homebuilder for a third consecutive year by Fortune Magazine as a leading builder of luxury homes in the United States. Over the last five years, Toll Brothers earnings have catapulted 207% from $4.03 a share in 2019 to $12.36 per share in 2023. This has exceeded the Zacks Building Products-Home Builders Industiry's historic EPS growth rate of 35%. Plus, Toll Brothers' annual earnings are expected to rise another 8% in fiscal 2024 which tops the industry’s anticipated average of 2.65% EPS growth and the S&P 500's 6.5%. More compelling is that Toll Brothers stock has soared +98% in the last year but still trades at just 8.7X forward earnings.
Image Source: Zacks Investment Research
Dream Finder Homes (DFH - Free Report) and Century Communities (CCS - Free Report) are two other homebuilders that have advantageous top and bottom-line expansion on the horizon. Both are expecting double-digit growth in this regard for FY24 with Dream Finder Home’s stock soaring +213% over the last year and trading at 12.2X forward earnings while Century Communities' shares have risen +47% and still trade at 8.6X.
Image Source: Zacks Investment Research
EMCOR Group (EME - Free Report) & Sterling Infrastructure's (STRL - Free Report) Expansion
EMCOR Group and Sterling Infrastructure’s expansion are standing out among the Zacks Building Products-Heavy Construction Industry and the Zacks Engineering-R and D Services Industry respectively.
As one of the leading providers of mechanical and electrical construction, EMCOR’s growth has been monstrous in recent years with EMC shares soaring +97% over the last year but trading at a reasonable 24X forward earnings multiple. EMCOR’s 132% EPS growth over the last five years is very impressive with annual earnings expected to be virtually flat in FY24 but rise 4% in FY25 to $13.91 per share.
Image Source: Zacks Investment Research
Meanwhile, Sterling Infrastructure is in the midst of its expansion as an E-Infrastructure, building, and transportation solutions provider. Sterling Infrastructure's stock has skyrocketed +175% in the last year with annual earnings and sales expected to rise 11% respectively to $4.98 per share and $2.2 billion. Sterling Infrastructure is expected to post double-digit growth on its top and bottom lines in FY25 as well and trades at 22.2X forward earnings and 1.7X sales.
Image Source: Zacks Investment Research
Bottom Line
Most compelling and indicative that the strong price performances of these Zacks Construction sector stocks could continue is that earnings estimate revisions for their FY24 and FY25 have continued to trend higher making now an ideal time to buy.