Truist Securities raises Ferguson stock price target to $240 from $200

Published 04/06/2025, 14:34
Truist Securities raises Ferguson stock price target to $240 from $200

On Wednesday, Truist Securities analysts increased the price target for Ferguson Plc. (NYSE: FERG) stock to $240 from $200 while maintaining a Buy rating. The adjustment follows Ferguson’s fiscal third-quarter results, which showed sales and EBIT margins surpassing expectations. According to InvestingPro data, five analysts have recently revised their earnings estimates upward, with the company maintaining a healthy 30.5% gross profit margin.

Ferguson stock surged 17% on Tuesday, significantly outperforming the S&P 500’s 0.6% rise. The company’s growth was driven by positive volume, particularly in HVAC, Waterworks, and Commercial/Industrial sectors, which experienced double-digit gains. These gains were attributed to share increases and a strong residential HVAC market.

The analysts noted that inflation slowed modestly during the quarter, with further easing expected in the second half of 2025. This could potentially benefit Ferguson’s results moving forward. Despite the positive outlook, the company’s guidance does not anticipate all gains to persist. The company maintains strong fundamentals with a current ratio of 1.64 and operates with moderate debt levels. Want deeper insights? InvestingPro offers 12 additional exclusive tips and comprehensive analysis for Ferguson.

Truist Securities emphasized that the next catalyst for Ferguson could be the anticipated inflation trends and a potential cycle turn. The analysts remain optimistic about the company’s performance and continue to recommend a Buy rating. Based on InvestingPro’s Fair Value analysis, the stock currently appears to be trading above its estimated intrinsic value.

In other recent news, Ferguson PLC (NYSE:FERG) reported its third-quarter earnings for 2025, revealing a mixed performance against market expectations. The company posted earnings per share (EPS) of $2.50, slightly below the forecast of $2.61, and revenue reached $7.62 billion, missing the projected $7.79 billion. Despite these misses, Ferguson’s stock saw a significant pre-market surge, reflecting investor confidence in the company’s strategic direction and operational efficiencies. Ferguson has also updated its full-year guidance to anticipate low to mid-single-digit revenue growth, with an operating margin range of 8.5% to 9%. The company plans to invest between $300 million and $350 million in capital expenditures. Additionally, Ferguson completed three acquisitions during the third quarter, including Independent (LON:IOG) Pipe and Supply, Light Innovations, and National Fire, enhancing its capabilities in various sectors. These recent developments highlight Ferguson’s ongoing efforts to position itself strategically in a challenging market environment.

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