Rizwan Siddiqui
2 min read
On June 4, Wells Fargo analyst Sam Reid reiterated a Buy rating on Ferguson Enterprises Inc. (NYSE:FERG), while raising the price target from $190 to $230. The price target revision follows the company's report of stronger-than-expected third-quarter results, which included an earnings beat and an upward revision of its full-year guidance.
The analyst's optimistic view is based on several encouraging trends. Most notably, in its Q3 results, Ferguson witnessed a 50 basis-point year-over-year improvement in gross margins, which helped offset broader cost pressures. The pricing trends also stabilized in the quarter after a long period of deflation, which is a positive development for future revenue visibility.
An engineer inspecting a HVAC system, revealing the complexity of the products.
In addition, Ferguson kept its SG&A expenses in check despite cost pressures, maintaining stability with efficiency measures. The company reported solid organic sales growth and strong performance across key market segments, reinforcing Reid’s positive outlook for the near term.
Reid expects the momentum from Q3 to carry into fiscal 2026. The revised guidance for fiscal 2025 further strengthens his optimistic view, backed by improved earnings quality and solid fundamentals that support the higher price target.
Ferguson Enterprises Inc. (NYSE:FERG) is a leading distributor of plumbing, HVAC, waterworks, and industrial products in North America. It serves professional contractors and builders across residential, commercial, and industrial markets.
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