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Ferguson PLC - Stock Quote FERG

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Morningstar's Ferguson PLC Stock Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Strong Sales Growth Continues for Ferguson, but Margins Ease Off Recent Highs

Analyst Note

| Brian Bernard, CFA, CPA |

Extraordinary revenue growth continued for narrow-moat-rated Ferguson during its fiscal second quarter (ended Jan. 31) as residential repair and remodel and construction spending remained robust. Compared with the prior-year quarter, reported revenue increased 31% to $6.5 billion, driven by 20%-plus growth across all the firm's U.S. end markets and 14% growth in Canada. Residential trade sales increased 31% year over year, while residential repair and remodel and digital commerce sales expanded 21% and 24%, respectively. Waterworks (public and private water infrastructure) had a blowout quarter with 61% year-over-year revenue growth. We believe this strong growth supports our view that homebuilders are ramping up land development to increase community count. That said, we don't expect public homebuilders (in aggregate) will realize year-over-year community count growth until late 2022 or early 2023.

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Ferguson PLC's Company Profile

Business Description

Ferguson distributes plumbing and HVAC products primarily to repair, maintenance, and improvement, new construction, and civil infrastructure markets. It serves over 1 million customers and sources products from 34,000 suppliers. Ferguson engages customers through approximately 1,600 North American branches, over the phone, online, and in residential showrooms. In fiscal 2021, Ferguson derived 94% of its nearly $23 billion of sales in the U.S. According to Modern Distribution Management, Ferguson is the largest industrial and construction distributor in North America. The firm sold its U.K. business in 2021 and is now solely focused on the North American market.

Contact
1020 Eskdale Road, Winnersh Triangle
Wokingham, Berkshire, RG41 5TS, United Kingdom
T +44 1189273800
Sector Industrials
Industry Industrial Distribution
Most Recent Earnings Jan 31, 2022
Fiscal Year End Jul 31, 2022
Stock Type
Employees 31,000