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%

FERG

0.3%

GB Trade Distributors

0.08%

GB Market


1 Year Return

-8.8%

FERG

8.7%

GB Trade Distributors

3.5%

GB Market


Shareholder returns

FERGIndustryMarket
7 Day0.3%0.3%0.08%
30 Day1.2%1.0%-1.3%
90 Day1.0%1.6%-2.2%
1 Year-0.8%-8.8%13.4%8.7%9.0%3.5%
3 Year48.8%30.7%43.0%29.8%18.1%3.1%
5 Year86.2%55.7%81.2%57.4%36.2%5.3%

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 compared to its fair value and its price relative to the market?

30.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FERG (£54.65) is trading below our estimate of fair value (£78.87)

Significantly Below Fair Value: FERG is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: FERG is poor value based on its PE Ratio (17.2x) compared to the Trade Distributors industry average (15.8x).

PE vs Market: FERG is poor value based on its PE Ratio (17.2x) compared to the UK market (16.7x).


Price to Earnings Growth Ratio

PEG Ratio: FERG is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: FERG is overvalued based on its PB Ratio (3.8x) compared to the GB Trade Distributors industry average (1.9x).


Next Steps

Future Growth

How is Ferguson forecast 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 Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FERG's forecast earnings growth (8.8% per year) is above the savings rate (1.2%).

Earnings vs Market: FERG's earnings (8.8% per year) are forecast to grow slower than the UK market (12.4% per year).

High Growth Earnings: FERG's earnings are forecast to grow, but not significantly.

Revenue vs Market: FERG's revenue (5.8% per year) is forecast to grow faster than the UK market (4% per year).

High Growth Revenue: FERG's revenue (5.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Information is not available.


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

Earnings Trend: FERG's earnings have grown by 10.3% per year over the past 5 years.

Accelerating Growth: FERG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FERG had negative earnings growth (-13.9%) over the past year, making it difficult to compare to the Trade Distributors industry average (3.4%).


Return on Equity

High ROE: FERG's Return on Equity (21.9%) is considered high.


Return on Assets

ROA vs Industry: FERG has a higher Return on Assets than the Trade Distributors industry average last year.


Return on Capital Employed

ROCE Improving: FERG has improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Ferguson's financial position?


Financial Position Analysis

Short Term Liabilities: FERG's short term assets ($6.7B) exceeds its short term liabilities ($3.6B)

Long Term Liabilities: FERG's short term assets (6.7B) exceeds its long term liabilities (2.8B)


Debt to Equity History and Analysis

Debt Level: FERG's debt to equity ratio (60.5%) is considered high

Reducing Debt: FERG's debt to equity ratio has increased from 47.6% to 60.5% over the past 5 years.

Debt Coverage: FERG's debt is well covered by operating cash flow (34.5%).

Interest Coverage: FERG's interest payments on its debt are well covered by EBIT (24x coverage).


Balance Sheet

Information is not available.

Information is not available.


Next Steps

Dividend

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

2.69%

Current Dividend Yield


Dividend Yield vs Market

company2.7%marketbottom25%2.0%markettop25%5.4%industryaverage2.5%forecastin3Years3.3%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: FERG's dividend (2.69%) is higher than the bottom 25% of dividend payers in the UK market (1.98%).

High Dividend: FERG's dividend (2.69%) is low compared to the top 25% of dividend payers in the UK market (5.37%).

Stable Dividend: FERG has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: FERG's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (46.8%), FERG's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FERG's dividends in 3 years are forecast to be well covered by earnings (45.2% payout ratio).


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

Information is not available.

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.8yrs

Average Tenure

50yo

Average Age

Experienced Management: FERG's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Age and Tenure

5.0yrs

Average Tenure

55yo

Average Age

Experienced Board: FERG's board of directors are considered experienced (5 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$491,70105 Dec 18
John Martin
EntityIndividual
Role
Chief Executive Officer
Group Chief Executive & Executive Director
Shares10,000
Max PriceUS$49.17

Ownership Breakdown


Management Team

  • Simon Oakland

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

    • Tenure: 0yrs
  • John Martin (52yo)

    Group Chief Executive & Executive Director

    • Tenure: 2.7yrs
    • Compensation: US$4.14m
  • Mark Fearon

    Director of Corporate Communications & Investor Relations

    • Tenure: 0yrs
  • Kevin Murphy

    CEO of USA & Executive Director

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

    Group CFO & Executive Director

    • Tenure: 1.9yrs
    • Compensation: US$1.18m
  • Graham Middlemiss

    Group Company Secretary & Interim Group General Counsel

    • Tenure: 0.2yrs
  • Sammie Long (50yo)

    Chief Human Resources Officer

    • Tenure: 2.3yrs
  • Mike Ward

    Head of Corporate Communications

    • Tenure: 0yrs
  • Marie Wall

    Group Director of Corporate Finance

    • Tenure: 0yrs
  • Mike Sajor

    Group Chief Information Officer

    • Tenure: 1.3yrs

Board Members

  • Alan Murray (64yo)

    Senior Non Executive Director

    • Tenure: 5.6yrs
    • Compensation: US$79.80k
  • Gareth Davis (68yo)

    Chairman

    • Tenure: 8.3yrs
    • Compensation: US$383.00k
  • Nadia Shouraboura (48yo)

    Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$66.70k
  • Darren Shapland (51yo)

    Independent Non-Executive Director

    • Tenure: 5yrs
    • Compensation: US$86.00k
  • John Martin (52yo)

    Group Chief Executive & Executive Director

    • Tenure: 2.7yrs
    • Compensation: US$4.14m
  • Kevin Murphy

    CEO of USA & Executive Director

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

    Group CFO & Executive Director

    • Tenure: 1.9yrs
    • Compensation: US$1.18m
  • Tessa Bamford (59yo)

    Independent Non-Executive Director

    • Tenure: 8.2yrs
    • Compensation: US$66.70k
  • Jacky Simmonds (55yo)

    Independent Non-Executive Director

    • Tenure: 5yrs
    • Compensation: US$83.00k
  • Cathy Halligan (55yo)

    Independent Non-Executive Director

    • Tenure: 0.3yrs

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: https://www.fergusonplc.com

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.