Download PDF

1. Company Snapshot

1.a. Company Description

Ferguson plc distributes plumbing and heating products in the United States and Canada.It offers plumbing and heating solutions to customers in the residential, commercial, civil/infrastructure, and industrial end markets.The company also distributes pipes, valves, fittings, plumbing supplies, water heaters, kitchen and bathroom fixtures, and appliances; heating, ventilation, air conditioning, and refrigeration products and supplies; and plumbing parts and supplies, fire sprinkler systems, hangers, struts, and fasteners.


In addition, it distributes water meters and automation products, irrigation and drainage products, geosynthetics, and stormwater management products; flanges, general industrial maintenance repair and operations products, high density polyethylene products, and fabrication products; water and wastewater treatment products; and PVF solutions.Further, the company offers services, including consultation, advice and project management, pro pick-up, and delivery services; online tools; quotation, jobsite delivery and logistics, project management, and fabrication services; digitally enhanced estimation, and design services; advanced metering infrastructure services; and supply chain and equipment rental services.The company also sells its products through online channels.


It operates a network of 1,679 branches and 11 distribution centers.Ferguson plc was founded in 1887 and is headquartered in Wokingham, the United Kingdom.

Show Full description

1.b. Last Insights on FERG

Ferguson's recent performance was driven by strong Q4 earnings, with operating profits and revenue beating Wall Street expectations. The company reported $8.5 billion in sales, a 6.9% increase from last year, and adjusted EPS of $3.48, up 16.8% from the prior year. Nine new acquisitions and investments in growth areas contributed to the results. A fresh dividend and ongoing buybacks also boosted shareholder value. The company's gross margin expanded 70 basis points to 31.7%, and operating profit rose 14.1% to $925 million.

1.c. Company Highlights

2. Ferguson's Q1 Results: Strong Execution Amidst Challenging Market Environment

Ferguson reported sales of $8.2 billion, a 5% increase over the prior year, driven by 4% organic growth and 1% acquisition growth. Gross margin expanded 60 basis points to 30.7%, and operating profit grew 14% to $808 million. Diluted earnings per share increased nearly 16% to $2.84. The company's expert associates delivered strong results, executing their growth strategy in a challenging market environment, as noted by CEO Kevin Murphy.

Publication Date: Dec -20

📋 Highlights
  • Sales Growth:: $8.2 billion net sales, +5.1% YoY (organic +4.2%, acquisitions +1%).
  • Margin Expansion:: Gross margin rose 60 bps to 30.7%, driving $808 million operating profit (+14.4% YoY).
  • Shareholder Returns:: $372 million returned via buybacks/dividends; dividend increased 7% to 89¢ per share.
  • Guidance Update:: 2025 revenue growth target of ~5%, operating margin of 9.4-9.6% despite near-term HVAC headwinds.
  • Segment Performance:: Commercial Mechanical +21%, Waterworks +14% growth, supported by large projects and strategic investments.

Segment Performance

In the US, net sales grew 5.3%, with nonresidential end markets performing better, up 12% during the quarter. The company's customer groups, including Waterworks, Ferguson Home, and Commercial Mechanical, saw growth during the quarter. Waterworks and Commercial Mechanical delivered 14% and 21% growth, respectively, indicating the success of the company's investments in key growth areas.

Guidance and Outlook

The company updated its guidance for calendar 2025, expecting approximately 5% revenue growth and an operating margin range of 9.4% to 9.6%. Despite near-term uncertainties, Ferguson remains confident in its markets over the medium term. The company expects incremental margins to run ahead of the targeted 11-13% rate due to positive pricing. Analysts estimate next year's revenue growth at 4.9%.

Valuation and Dividend

With a P/E Ratio of 22.96 and EV/EBITDA of 19.24, the market appears to have priced in a significant portion of Ferguson's growth prospects. However, the company's dividend yield of 1.45% and free cash flow yield of 3.71% provide a reasonable return to shareholders. The company declared a 7% increase to their quarterly dividend to 89¢ per share and returned $372 million to shareholders via share repurchases and dividends.

Operational Highlights

Ferguson continues to invest in key growth areas, including waterworks diversification, large capital projects, and value-added services. The company has made investments in trainees, HVAC counter expansion, and large project teams, with 250-300 trainees added this year. They have also completed 650 counter conversions, yielding real results.

3. NewsRoom

Card image cap

Ferguson Declares Dividend

Feb -19

Source:

Card image cap

Ferguson Declares Dividend

Feb -18

Source:

Card image cap

Is Ferguson Enterprises Inc.'s (NYSE:FERG) Recent Stock Performance Influenced By Its Fundamentals In Any Way?

Feb -15

Source:

Card image cap

Ingersoll Rand's Q4 Earnings & Revenues Top Estimates, Up Y/Y

Feb -13

Source:

Card image cap

What Is Ferguson Enterprises Inc.'s (NYSE:FERG) Share Price Doing?

Feb -11

Source:

Card image cap

Ferguson to Issue Results for the Period Ended December 31, 2025, as well as provide an Update on Market Opportunities and Strategy on February 24, 2026

Feb -11

Source:

Card image cap

Ferguson Enterprises Inc.: Notice of Dividend Currency Exchange Rate

Feb -10

Source:

Card image cap

EnerSys' Q3 Earnings Beat Estimates, Decrease Year Over Year

Feb -05

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Plumbing and Heating Products

Expected Growth: 4.5%

Ferguson plc's Plumbing and Heating Products segment, driven by increasing demand for pipes, valves, and fittings in residential and commercial markets, is expected to grow steadily, fueled by infrastructure development and renovation activities.

7. Detailed Products

Plumbing Fixtures

Ferguson plc offers a wide range of plumbing fixtures, including sinks, toilets, showers, and faucets from top brands.

HVAC Equipment

Ferguson plc provides heating, ventilation, and air conditioning (HVAC) equipment, including furnaces, air conditioners, and heat pumps.

Waterworks Products

Ferguson plc offers a variety of waterworks products, including pipes, valves, and fittings for water and sewage systems.

Industrial PVF Products

Ferguson plc provides industrial pipe, valve, and fitting (PVF) products for industrial applications, including oil and gas, chemical processing, and power generation.

Fire Protection Systems

Ferguson plc offers fire protection systems, including fire suppression systems, fire alarms, and sprinkler systems.

Water Treatment Solutions

Ferguson plc provides water treatment solutions, including water softeners, filtration systems, and purification systems.

8. Ferguson plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Ferguson plc operates in a industry with moderate threat of substitutes. The company's products and services can be substituted with alternative offerings from competitors, but the switching costs are relatively high.

Bargaining Power Of Customers

Ferguson plc's customers have low bargaining power due to the company's strong brand reputation and wide range of products and services offered.

Bargaining Power Of Suppliers

Ferguson plc's suppliers have moderate bargaining power due to the company's large scale of operations and diversified supply chain.

Threat Of New Entrants

The threat of new entrants in Ferguson plc's industry is low due to the high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry in Ferguson plc's industry is high due to the presence of several large competitors and the need to constantly innovate and differentiate products and services.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 51.07%
Debt Cost 4.96%
Equity Weight 48.93%
Equity Cost 10.01%
WACC 7.43%
Leverage 104.39%

11. Quality Control: Ferguson plc passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
ALA

A-Score: 6.8/10

Value: 6.0

Growth: 6.0

Quality: 6.2

Yield: 5.0

Momentum: 9.5

Volatility: 8.3

1-Year Total Return ->

View Full Report
Stock-Card
Vinci

A-Score: 6.7/10

Value: 6.3

Growth: 6.1

Quality: 4.7

Yield: 6.9

Momentum: 7.0

Volatility: 9.0

1-Year Total Return ->

View Full Report
Stock-Card
Samse

A-Score: 5.7/10

Value: 7.9

Growth: 3.9

Quality: 2.4

Yield: 8.8

Momentum: 2.0

Volatility: 9.3

1-Year Total Return ->

View Full Report
Stock-Card
BAE Systems

A-Score: 4.9/10

Value: 2.4

Growth: 6.8

Quality: 4.9

Yield: 5.0

Momentum: 4.5

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
Saint-Gobain

A-Score: 4.8/10

Value: 4.7

Growth: 5.8

Quality: 4.5

Yield: 4.4

Momentum: 4.0

Volatility: 5.3

1-Year Total Return ->

View Full Report
Stock-Card
Ferguson

A-Score: 3.9/10

Value: 2.4

Growth: 6.2

Quality: 5.8

Yield: 3.1

Momentum: 0.0

Volatility: 6.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

185.7$

Current Price

185.7$

Potential

-0.00%

Expected Cash-Flows