Ferguson plc (NYSE:FERG) Receives Consensus Rating of "Moderate Buy" from Analysts

Key Points

• Analysts remain broadly positive: Ferguson has a “Moderate Buy” consensus from 17 brokerages, with 11 buy ratings, five holds and one strong buy. The average 12-month price target is approximately $284.86, above the reported $245.27 opening price.
• Quarterly results exceeded expectations: Ferguson reported EPS of $3.39 versus the $3.23 consensus estimate on $8.75 billion in revenue, leading several analysts to raise their price targets and reflecting confidence in the company’s outlook.
• New debt adds leverage considerations: Ferguson priced $1.2 billion of senior notes, including $700 million due in 2029 and $500 million due in 2036. While the proceeds may support corporate purposes or refinancing, the borrowing will increase interest expense and debt obligations.

Ferguson plc (NYSE:FERG - Get Free Report) has been given a consensus rating of "Moderate Buy" by the seventeen brokerages that are covering the stock, Marketbeat reports. Five investment analysts have rated the stock with a hold recommendation, eleven have given a buy recommendation and one has issued a strong buy recommendation on the company. The average 12-month target price among brokers that have issued a report on the stock in the last year is $284.8564.

A number of analysts have recently commented on FERG shares. UBS Group lifted their price target on Ferguson from $252.00 to $256.00 and gave the company a "neutral" rating in a research note on Tuesday. Weiss Ratings upgraded shares of Ferguson from a "hold (c)" rating to a "hold (c+)" rating in a report on Thursday, July 2nd. Sanford C. Bernstein lifted their target price on shares of Ferguson from $310.00 to $325.00 and gave the stock an "outperform" rating in a research report on Tuesday. Robert W. Baird lifted their target price on shares of Ferguson from $285.00 to $288.00 and gave the stock an "outperform" rating in a research report on Tuesday. Finally, Barclays boosted their target price on shares of Ferguson from $297.00 to $313.00 and gave the stock an "overweight" rating in a report on Tuesday.

Institutional Trading of Ferguson

A number of institutional investors and hedge funds have recently bought and sold shares of the stock. Leonteq Securities AG bought a new position in Ferguson during the 4th quarter worth $26,000. Basepoint Wealth LLC acquired a new position in Ferguson during the 4th quarter worth about $26,000. Compass Financial Management LLC bought a new stake in shares of Ferguson in the 2nd quarter valued at about $32,000. Zions Bancorporation National Association UT grew its position in shares of Ferguson by 123.4% in the 4th quarter. Zions Bancorporation National Association UT now owns 143 shares of the company's stock valued at $32,000 after buying an additional 79 shares during the last quarter. Finally, Johnson Financial Group Inc. acquired a new stake in shares of Ferguson in the third quarter valued at about $34,000. 81.98% of the stock is currently owned by institutional investors and hedge funds.

Key Ferguson News

Here are the key news stories impacting Ferguson this week:

• Positive Sentiment: Strong quarterly performance and improved outlook: Ferguson reported second-quarter EPS of $3.39, exceeding the $3.23 consensus estimate, on $8.75 billion in revenue. The company also raised its full-year outlook, prompting analysts to increase their forecasts. Ferguson Analysts Boost Their Forecasts Following Better-Than-Expected Q2 Earnings
• Positive Sentiment: Higher analyst price targets: Wells Fargo raised its target from $285 to $295 and maintained an “overweight” rating, while Robert W. Baird increased its target from $285 to $288 and kept an “outperform” rating. These revisions indicate continued confidence in Ferguson’s earnings growth and industry position. Ferguson Analyst Price Target Revisions
• Neutral Sentiment: Debt financing announced: Ferguson priced $700 million of 4.800% senior notes due 2029 and $500 million of 5.600% senior notes due 2036. The proceeds could support general corporate purposes or refinancing, but the transaction adds interest expense and debt obligations. Ferguson Prices $1.2 Billion of Senior Unsecured Notes
• Negative Sentiment: Potential pressure from higher leverage: Although Ferguson’s operating results were strong, investors may focus on the cost of the new borrowing, particularly the 5.600% coupon on the 2036 notes, as elevated interest expense can reduce future earnings and financial flexibility.

Ferguson Trading Down 2.5%

NYSE FERG opened at $245.27 on Thursday. The company has a market cap of $47.45 billion, a price-to-earnings ratio of 28.52, a price-to-earnings-growth ratio of 1.77 and a beta of 1.14. Ferguson has a twelve month low of $207.64 and a twelve month high of $271.64. The company has a quick ratio of 0.96, a current ratio of 1.78 and a debt-to-equity ratio of 0.68. The business's fifty day moving average is $235.04 and its 200 day moving average is $240.87.

Ferguson (NYSE:FERG - Get Free Report) last issued its earnings results on Monday, August 10th. The company reported $3.39 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $3.23 by $0.16. The business had revenue of $8.75 billion during the quarter. Ferguson had a return on equity of 37.68% and a net margin of 6.82%. As a group, sell-side analysts expect that Ferguson will post 11.29 EPS for the current fiscal year.

Ferguson declared that its Board of Directors has approved a share repurchase program on Tuesday, May 5th that allows the company to buyback $2.00 billion in outstanding shares. This buyback authorization allows the company to reacquire up to 3.9% of its stock through open market purchases. Stock buyback programs are usually an indication that the company's board believes its shares are undervalued.

Ferguson Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, October 7th. Stockholders of record on Friday, August 21st will be issued a dividend of $0.89 per share. This represents a $3.56 dividend on an annualized basis and a dividend yield of 1.5%. The ex-dividend date is Friday, August 21st. Ferguson's payout ratio is 41.40%.

Ferguson Company Profile

Ferguson NYSE: FERG is a multinational distributor specializing in plumbing and heating products and related building supplies, serving professional contractors, builders and industrial customers. The company supplies a broad range of products used in residential, commercial and infrastructure projects, including pipes and fittings, valves and controls, HVAC equipment, waterworks materials, plumbing fixtures, pumps and accessories, as well as complementary electrical and specialty product lines.

Ferguson operates a network of branches and distribution centers that provide inventory, logistics and value-added services to trade customers.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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