RBC Capital reiterates outperform rating on Ferguson stock

Published 03/06/2025, 14:02
RBC Capital reiterates outperform rating on Ferguson stock

On Tuesday, RBC Capital analysts reaffirmed their Outperform rating for Ferguson Plc. (NYSE: FERG) stock, maintaining a price target of $189.00. The reaffirmation comes after the company reported unexpectedly strong results for its fiscal third quarter, highlighting significant gains in both pricing and margins. According to InvestingPro data, Ferguson currently trades at $180.29, with analysts’ targets ranging from $168 to $258.

Ferguson Plc.’s fiscal third-quarter performance was marked by a robust increase in organic growth and margins, prompting analysts to predict continued strength into the fourth quarter. With a robust gross profit margin of 30.35% and annual revenue of $29.9 billion, the company’s updated fiscal year guidance suggests ongoing momentum in these areas. InvestingPro analysis shows the company maintains strong financial health with a current ratio of 1.82, indicating solid liquidity management.

Key discussion points for Ferguson’s upcoming call include the factors driving the margin and price improvements seen in the third quarter, as well as the anticipated strength in the fourth quarter. Analysts are also keen to understand recent demand and pricing trends, and the composition of volume, price, and margin for the upcoming quarter.

Further topics of interest for analysts include the company’s cost-reduction initiatives, insights into end markets and product categories, and the implications of tariffs on pricing and costs. Additionally, the rationale behind Ferguson’s revised capital expenditure guidance and its approach to mergers and acquisitions and capital deployment will be scrutinized.

The reaffirmation of the Outperform rating and the maintained price target reflect analysts’ confidence in Ferguson’s ability to sustain its recent performance and navigate market challenges effectively.

In other recent news, Ferguson Plc has reported impressive earnings and revenue results for the third quarter of 2025. The company achieved a 5.0% organic revenue growth, with significant contributions from its U.S. and Canadian markets. This growth surpassed previous quarters and analyst expectations, aided by strategic acquisitions and pricing strategies. Ferguson’s adjusted operating profit reached $715 million, marking a 6% year-over-year increase and beating consensus forecasts by approximately 17%. In response to these results, Morgan Stanley (NYSE:MS) reaffirmed its Overweight rating on Ferguson, maintaining a price target of $195.00, while Truist Securities reiterated a Buy rating with a $200 price target. Ferguson also raised its full-year guidance, now expecting low to mid-single-digit revenue growth and an improved adjusted operating margin outlook. The company completed three acquisitions in the quarter and executed share buybacks totaling $251 million. Despite slightly missing revenue forecasts, Ferguson’s strong performance in non-residential construction and efficiency actions have positioned it well in a competitive market.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.