Ferguson Enterprises Inc. Just Missed EPS By 6.7%: Here's What Analysts Think Will Happen Next

Last week, you might have seen that Ferguson Enterprises Inc. (NYSE:FERG) released its half-yearly result to the market. The early response was not positive, with shares down 7.1% to US$155 in the past week. It looks like the results were a bit of a negative overall. While revenues of US$15b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 6.7% to hit US$1.38 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Ferguson Enterprises after the latest results.

See our latest analysis for Ferguson Enterprises

Taking into account the latest results, Ferguson Enterprises' 21 analysts currently expect revenues in 2025 to be US$30.3b, approximately in line with the last 12 months. Statutory per-share earnings are expected to be US$8.38, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of US$30.3b and earnings per share (EPS) of US$9.05 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target fell 8.3% to US$197, with the analysts clearly linking lower forecast earnings to the performance of the stock price. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Ferguson Enterprises at US$258 per share, while the most bearish prices it at US$168. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ferguson Enterprises' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Ferguson Enterprises' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 2.5% growth on an annualised basis. This is compared to a historical growth rate of 9.1% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% per year. Factoring in the forecast slowdown in growth, it seems obvious that Ferguson Enterprises is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Ferguson Enterprises' revenue is expected to perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Ferguson Enterprises' future valuation.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Ferguson Enterprises analysts - going out to 2027, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Ferguson Enterprises that we have uncovered.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.