OTCPK:FERG.Y

Stock Analysis Report

Executive Summary

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


Snowflake Analysis

Outstanding 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

Stable Share Price: FERG.Y has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.2%

FERG.Y

-0.6%

US Trade Distributors

-1.1%

US Market


1 Year Return

39.1%

FERG.Y

9.2%

US Trade Distributors

17.8%

US Market

Return vs Industry: FERG.Y exceeded the US Trade Distributors industry which returned 9.1% over the past year.

Return vs Market: FERG.Y exceeded the US Market which returned 17.9% over the past year.


Shareholder returns

FERG.YIndustryMarket
7 Day-1.2%-0.6%-1.1%
30 Day5.5%0.3%1.5%
90 Day9.0%-0.5%6.6%
1 Year42.2%39.1%11.3%9.2%20.2%17.8%
3 Year68.6%50.5%20.5%14.9%47.5%38.1%
5 Year74.2%49.2%42.9%32.2%71.2%52.4%

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

No news available

Valuation

Is Ferguson undervalued compared to its fair value and its price relative to the market?

21.28x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: FERG.Y ($9.72) is trading above our estimate of fair value ($6.35)

Significantly Below Fair Value: FERG.Y is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: FERG.Y is poor value based on its PE Ratio (21.3x) compared to the Trade Distributors industry average (15.9x).

PE vs Market: FERG.Y is poor value based on its PE Ratio (21.3x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: FERG.Y is poor value based on its PEG Ratio (4.6x)


Price to Book Ratio

PB vs Industry: FERG.Y is overvalued based on its PB Ratio (5.2x) compared to the US Trade Distributors industry average (1.6x).


Next Steps

Future Growth

How is Ferguson forecast to perform in the next 1 to 3 years based on estimates from 23 analysts?

4.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FERG.Y's forecast earnings growth (4.6% per year) is above the savings rate (1.7%).

Earnings vs Market: FERG.Y's earnings (4.6% per year) are forecast to grow slower than the US market (14.1% per year).

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

Revenue vs Market: FERG.Y's revenue (3.1% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: FERG.Y's revenue (3.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FERG.Y's Return on Equity is forecast to be high in 3 years time (24.7%)


Next Steps

Past Performance

How has Ferguson performed over the past 5 years?

12.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FERG.Y has high quality earnings.

Growing Profit Margin: FERG.Y's current net profit margins (4.8%) are higher than last year (4.1%).


Past Earnings Growth Analysis

Earnings Trend: FERG.Y's earnings have grown by 12% per year over the past 5 years.

Accelerating Growth: FERG.Y's earnings growth over the past year (26.2%) exceeds its 5-year average (12% per year).

Earnings vs Industry: FERG.Y earnings growth over the past year (26.2%) exceeded the Trade Distributors industry 5.2%.


Return on Equity

High ROE: FERG.Y's Return on Equity (24.4%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Ferguson's financial position?


Financial Position Analysis

Short Term Liabilities: FERG.Y's short term assets ($7.2B) exceed its short term liabilities ($4.2B).

Long Term Liabilities: FERG.Y's short term assets ($7.2B) exceed its long term liabilities ($2.9B).


Debt to Equity History and Analysis

Debt Level: FERG.Y's debt to equity ratio (53.9%) is considered high.

Reducing Debt: FERG.Y's debt to equity ratio has increased from 33.2% to 53.9% over the past 5 years.

Debt Coverage: FERG.Y's debt is well covered by operating cash flow (55%).

Interest Coverage: FERG.Y's interest payments on its debt are well covered by EBIT (17.7x coverage).


Balance Sheet

Inventory Level: FERG.Y has a high level of physical assets or inventory.

Debt Coverage by Assets: FERG.Y's debt is covered by short term assets (assets are 3.1x debt).


Next Steps

Dividend

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

2.12%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: FERG.Y's dividend (2.12%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: FERG.Y's dividend (2.12%) is low compared to the top 25% of dividend payers in the US market (3.73%).


Stability and Growth of Payments

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

Growing Dividend: FERG.Y's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45.2%), FERG.Y's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FERG.Y's dividends in 3 years are forecast to be well covered by earnings (44.3% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.1yrs

Average management tenure


CEO

Kevin Murphy 0

0.3yrs

Tenure

US$2,285,000

Compensation

Mr. Kevin Murphy has been the Chief Executive Officer and Director of Ferguson Enterprises, Inc since August 01, 2017. Mr. Murphy served as Chief Executive Officer of USA at Ferguson plc since August 01, 2 ...


CEO Compensation Analysis

Compensation vs Market: Kevin's total compensation ($USD2.29M) is below average for companies of similar size in the US market ($USD10.81M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Kevin Murphy
CEO & Executive Director0.3yrsUS$2.29m0.026% $5.8m
Michael Powell
Group CFO & Executive Director2.7yrsUS$2.28m0.0087% $1.9m
Marie Wall
Group Director of Corporate Finance0yrsno datano data
Mike Sajor
Group Chief Information Officer2.1yrsno datano data
Mark Fearon
Director of Corporate Communications & Investor Relations0yrsno datano data
Ian Graham
Group General Counsel0.8yrsno datano data
Michael Ward
Head of Corporate Communications0yrsno datano data
Samantha Long
Chief Human Resources Officer3.1yrsno datano data
John Wilcox
Senior Vice President of Alignment and Coordination - Wolseley North America0yrsno datano data
Al Byrd
Senior Vice President of Supply Chain - Wolseley North America0yrsno datano data

2.1yrs

Average Tenure

Experienced Management: FERG.Y's management team is considered experienced (2.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Kevin Murphy
CEO & Executive Director0.3yrsUS$2.29m0.026% $5.8m
Michael Powell
Group CFO & Executive Director2.7yrsUS$2.28m0.0087% $1.9m
Alan Murray
Senior Independent Non Executive Director6.3yrsUS$95.80k0.0011% $233.1k
Nadia Shouraboura
Independent Non-Executive Director2.6yrsUS$78.50kno data
Geoffrey Drabble
Independent Non Executive Chairman0.3yrsUS$18.30kno data
Thomas Schmitt
Independent Non Executive Director1yrsUS$42.20kno data
Tessa Bamford
Independent Non-Executive Director8.9yrsUS$78.50k0.00087% $191.4k
Jacqueline Simmonds
Independent Non-Executive Director5.8yrsUS$93.50k0.00084% $184.8k
Catherine Halligan
Independent Non-Executive Director1.1yrsUS$50.00kno data

2.6yrs

Average Tenure

56yo

Average Age

Experienced Board: FERG.Y's board of directors are not considered experienced ( 2.6 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

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


Key Information

  • Name: Ferguson plc
  • Ticker: FERG.Y
  • Exchange: OTCPK
  • Founded: 1887
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: UK£16.964b
  • Listing Market Cap: UK£21.995b
  • Shares outstanding: 224.21m
  • 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
FERGLBATS-CHIXE (BATS 'Chi-X Europe')Old Ordinary SharesGBGBPJan 1992
FERGLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
WOSC.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 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, municipal, civil and industrial markets, and commercial sectors for repair, maintenance, and improvement (RMI), as well as new construction markets. The company also distributes pipes, valves, fittings, hydrants, meters, and related water management products, as well as offers related services, such as water line tapping and pipe fusion services. In addition, it distributes heating, ventilation, air conditioning, refrigeration equipment, and parts and supplies to specialist contractors in the residential and commercial markets for repair and replacement; and PVF products to industrial customers. Further, the company fabricates and supplies fire protection systems and bespoke fabrication services to commercial contractors for new construction and renovation projects, as well as offers products, services, and solutions to enable maintenance of facilities across various RMI markets. Additionally, it offers supply chain management solutions for PVF; and industrial maintenance, repair, and operations specializing in delivering automation, instrumentation, engineered products, and turn-key solutions. The company also sells its home improvement products directly to consumers, as well as through a network of online stores. In addition, it operates its B2B business primarily under the Ferguson brand; and B2C business under the Build.com brand. Further, the company provides products and services for maintenance of multi-family properties, government agencies, hospitality, education, healthcare, and other facilities. It operates a network of 2,280 branches and 19 distribution centers. Ferguson plc was founded in 1887 and is headquartered in Wokingham, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/24 01:44
End of Day Share Price2020/02/21 00:00
Earnings2019/07/31
Annual Earnings2019/07/31


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.