LSE:FERG

Stock Analysis Report

Executive Summary

Ferguson plc distributes plumbing and heating products in the United States, the United Kingdom, Canada, and Central Europe.

Snowflake

Fundamentals

Proven track record with adequate balance sheet.


Similar Companies

Share Price & News

How has Ferguson's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.3%

LSE:FERG

-2.2%

GB Trade Distributors

-1.7%

GB Market


1 Year Return

-8.8%

LSE:FERG

-5.8%

GB Trade Distributors

-5.7%

GB Market

FERG underperformed the Trade Distributors industry which returned -4.8% over the past year.

FERG underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -5.6% over the past year.


Share holder returns

FERGIndustryMarket
7 Day0.3%-2.2%-1.7%
30 Day1.2%-1.0%-4.6%
90 Day1.0%0.7%-3.2%
1 Year-0.8%-8.8%-1.9%-5.8%-1.3%-5.7%
3 Year48.8%30.7%34.5%22.1%17.8%4.0%
5 Year86.2%55.7%72.0%48.8%26.9%0.2%

Price Volatility Vs. Market

How volatile is Ferguson's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Ferguson undervalued based on future cash flows and its price relative to the stock market?

31%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Ferguson's share price is below the future cash flow value, and at a moderate discount (> 20%).

Ferguson's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

Ferguson is overvalued based on earnings compared to the GB Trade Distributors industry average.

Ferguson is overvalued based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.


Price Based on Expected Growth

Ferguson is poor value based on expected growth next year.


Price Based on Value of Assets

Ferguson is overvalued based on assets compared to the GB Trade Distributors industry average.


Next Steps

Future Growth

How is Ferguson expected to perform in the next 1 to 3 years based on estimates from 21 analysts?

8.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Ferguson's revenue is expected to grow by 5.8% yearly, however this is not considered high growth (20% yearly).

Ferguson's earnings are expected to grow by 8.8% yearly, however this is not considered high growth (20% yearly).

Ferguson's revenue growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.

Ferguson's earnings growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.

Ferguson's earnings growth is expected to exceed the low risk savings rate of 1.2%.


Earnings per Share Growth Estimates


Future Return on Equity

Ferguson is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).


Next Steps

Past Performance

How has Ferguson performed over the past 5 years?

10.3%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Ferguson's year on year earnings growth rate has been positive over the past 5 years.

Ferguson's 1-year earnings growth is negative, it can't be compared to the 5-year average.

Ferguson's 1-year earnings growth is negative, it can't be compared to the GB Trade Distributors industry average.


Return on Equity

Ferguson has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).


Return on Assets

Ferguson used its assets more efficiently than the GB Trade Distributors industry average last year based on Return on Assets.


Return on Capital Employed

Ferguson has improved its use of capital last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Ferguson's financial position?


Financial Position Analysis

Ferguson is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Ferguson's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Ferguson's level of debt (60.5%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (47.6% vs 60.5% today).

Debt is well covered by operating cash flow (34.5%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 24x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 2.6x debt.


Next Steps

Dividend

What is Ferguson's current dividend yield, its reliability and sustainability?

3.27%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Ferguson's pays a higher dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (2.04%).

Ferguson's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.26%).

Ferguson has been paying a dividend for less than 10 years and during this time payments have been volatile (annual drop of over 20%).

Dividend payments have increased, but Ferguson only paid a dividend in the past 8 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (2.1x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be well covered by earnings (2.2x coverage).


Next Steps

Management

What is the CEO of Ferguson's salary, the management and board of directors tenure and is there insider trading?

1.8yrs

Average management tenure


CEO

John Martin (52yo)

2.7yrs

Tenure

US$4,138,300

Compensation

Mr. John W. Martin has been the Chief Executive Officer of Ferguson plc since September 1, 2016 and served as its Group Chief Financial Officer from April 01, 2010 to August 31, 2016. Mr. Martin has been a ...


CEO Compensation Analysis

John's remuneration is about average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.

John's compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.8yrs

Average Tenure

50yo

Average Age

The average tenure for the Ferguson management team is less than 2 years, this suggests a new team.


Board Age and Tenure

5.0yrs

Average Tenure

55yo

Average Age

The tenure for the Ferguson board of directors is about average.


Insider Trading

No 3 month insider trading information.


Recent Insider Transactions

BuyUK£491,70105 Dec 18
John Martin
EntityIndividual
Role
Group Chief Executive & Executive Director
Member of the Board of Directors
Shares10,000
Max PriceUK£49.17

Ownership Breakdown


Management Team

  • John Martin (52yo)

    Group Chief Executive & Executive Director

    • Tenure: 2.7yrs
    • Compensation: $4.14m
  • Graham Middlemiss

    Group Company Secretary & Interim Group General Counsel

    • Tenure: 0.2yrs
  • Kevin Murphy

    CEO of USA & Executive Director

    • Tenure: 1.8yrs
    • Compensation: $2.18m
  • Mike Powell (50yo)

    Group CFO & Executive Director

    • Tenure: 1.9yrs
    • Compensation: $1.18m
  • Mike Sajor

    Group Chief Information Officer

    • Tenure: 1.3yrs
  • Sammie Long (50yo)

    Chief Human Resources Officer

    • Tenure: 2.3yrs
  • Simon Oakland

    CEO of Canada & Central Europe and Group Head of Corporate Development

  • Mark Fearon

    Director of Corporate Communications & Investor Relations

  • Mike Ward

    Head of Corporate Communications

  • Marie Wall

    Group Director of Corporate Finance


Board Members

  • John Martin (52yo)

    Group Chief Executive & Executive Director

    • Tenure: 9.1yrs
    • Compensation: $4.14m
  • Kevin Murphy

    CEO of USA & Executive Director

    • Tenure: 1.8yrs
    • Compensation: $2.18m
  • Mike Powell (50yo)

    Group CFO & Executive Director

    • Tenure: 1.9yrs
    • Compensation: $1.18m
  • Gareth Davis (68yo)

    Chairman

    • Tenure: 8.3yrs
    • Compensation: $383.00k
  • Darren Shapland (51yo)

    Independent Non-Executive Director

    • Tenure: 5.0yrs
    • Compensation: $86.00k
  • Nadia Shouraboura (48yo)

    Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: $66.70k
  • Cathy Halligan (55yo)

    Independent Non-Executive Director

    • Tenure: 0.3yrs
  • Jacky Simmonds (55yo)

    Independent Non-Executive Director

    • Tenure: 5.0yrs
    • Compensation: $83.00k
  • Tessa Bamford (59yo)

    Independent Non-Executive Director

    • Tenure: 8.2yrs
    • Compensation: $66.70k
  • Alan Murray (64yo)

    Senior Non Executive Director

    • Tenure: 5.6yrs
    • Compensation: $79.80k

Company Information

Ferguson plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ferguson plc
  • Ticker: FERG
  • Exchange: LSE
  • Founded: 1887
  • Industry: trading companies and distributors
  • Sector: capital goods
  • Market Cap: UK£12.602b
  • Shares outstanding: 230.59m
  • Website: Click here

Number of Employees


Location

  • Ferguson plc
  • 1020 Eskdale Road
  • Winnersh Triangle
  • Wokingham
  • Berkshire
  • RG41 5TS
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WOSC.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
FERGLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
24W2DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
FERGLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
24W5BST (Boerse-Stuttgart)YesOrdinary SharesDEEURJan 1992
FERG.YOTCPK (Pink Sheets LLC)SPONSRD ADS NEWUSUSDMay 2001
FERGLSE (London Stock Exchange)ORD GBP0.11403197GBGBPJun 2018

Biography

Ferguson plc distributes plumbing and heating products in the United States, the United Kingdom, Canada, and Central Europe. It offers plumbing and heating solutions to customers in the residential, munici ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/05/15 21:31
End of Day Share Price2019/05/14 00:00
Earnings2019/01/31
Annual Earnings2018/07/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.