Ferguson Enterprises' analyst price target was modestly increased from $255.30 to $257.00, as analysts cited the company's strong organic growth, robust performance in non-residential markets, and continued share gains despite challenges in the residential and HVAC sectors.

Analyst Commentary

Following Ferguson Enterprises' latest quarterly results, a number of bullish analysts have raised their price targets, citing strong performance in key areas and ongoing share gains. At the same time, some caution remains due to specific sector headwinds and mixed outlooks for certain markets.

• Bullish analysts highlight Ferguson's robust organic growth, driven in large part by outperformance in non-residential markets and positive pricing trends.
• The company's continued share gains, even amid challenging end markets, are seen as a testament to its strong business model and execution.
• Several note Ferguson's ability to capture large projects and maintain a balanced mix across commercial, civil, and infrastructure verticals. These factors help support valuation upgrades.
• Expectations for an eventual industry recovery are prompting some to assign a higher valuation, reflecting confidence in the company's potential for group-leading growth when residential and non-residential cycles improve.

• Bearish analysts remain cautious about persistent headwinds in new residential construction and HVAC sectors, which are likely to weigh on near-term results.
• Some are adopting more conservative margin forecasts, especially for the latter half of fiscal 2025. This could temper earnings upside.
• While share gains are recognized, the uncertain pace and breadth of an end-market recovery inject an element of risk to forward-looking estimates.

What's in the News

• Ferguson Enterprises completed the repurchase of 26,779,484 shares, representing 12.74% of its outstanding shares for $4.04 billion as part of its ongoing share buyback program. (Key Developments)
• The Board amended and restated the company’s bylaws to establish its fiscal year-end as December 31, aligning with a shift in financial reporting. (Key Developments)
• The company's fiscal year-end will change from July 31 to December 31. There will be a five-month transition period in 2025, enabling reporting on a calendar year basis starting January 1, 2026. (Key Developments)
• Ferguson Enterprises issued guidance for calendar year 2025, expecting mid-single digit growth in net sales. (Key Developments)

Valuation Changes

• Fair Value Estimate has risen slightly, increasing from $255.30 to $257.00 per share.
• Discount Rate edged up marginally from 8.13% to 8.14%.
• Revenue Growth projection remains essentially unchanged at 4.76%.
• Net Profit Margin estimate is steady, holding at roughly 6.78%.
• Future P/E Ratio has increased incrementally from 24.92x to 25.09x.