Ferguson plc
Ferguson plc Fundamental Analysis
Ferguson plc (FERG) shows moderate financial fundamentals with a PE ratio of 20.52, profit margin of 6.51%, and ROE of 35.56%. The company generates $31.6B in annual revenue with weak year-over-year growth of -0.33%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 51.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze FERG's fundamental strength across five key dimensions:
Efficiency Score
ExcellentFERG demonstrates superior asset utilization.
Valuation Score
ModerateFERG shows balanced valuation metrics.
Growth Score
WeakFERG faces weak or negative growth trends.
Financial Health Score
ExcellentFERG maintains a strong and stable balance sheet.
Profitability Score
ModerateFERG maintains healthy but balanced margins.
Key Financial Metrics
Is FERG Expensive or Cheap?
P/E Ratio
FERG trades at 20.52 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, FERG's PEG of 3.33 indicates potential overvaluation.
Price to Book
The market values Ferguson plc at 7.25 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 11.26 times EBITDA. This signals the market has high growth expectations.
How Well Does FERG Make Money?
Net Profit Margin
For every $100 in sales, Ferguson plc keeps $6.51 as profit after all expenses.
Operating Margin
Core operations generate 9.12 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $35.56 in profit for every $100 of shareholder equity.
ROA
Ferguson plc generates $12.06 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Ferguson plc generates limited operating cash flow of $1.16B, signaling weaker underlying cash strength.
Free Cash Flow
Ferguson plc generates weak or negative free cash flow of $940.43M, restricting financial flexibility.
FCF Per Share
Each share generates $4.84 in free cash annually.
FCF Yield
FERG converts 2.24% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
20.52
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
3.33
vs 25 benchmark
P/B Ratio
Price to book value ratio
7.25
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.33
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.92
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.86
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.36
vs 25 benchmark
ROA
Return on assets percentage
0.12
vs 25 benchmark
ROCE
Return on capital employed
0.24
vs 25 benchmark
How FERG Stacks Against Its Sector Peers
| Metric | FERG Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 20.52 | 24.98 | Better (Cheaper) |
| ROE | 35.56% | 1284.00% | Weak |
| Net Margin | 6.51% | -45683.00% (disorted) | Weak |
| Debt/Equity | 0.92 | 0.79 | Neutral |
| Current Ratio | 1.86 | 10.67 | Neutral |
| ROA | 12.06% | -1542352.00% (disorted) | Strong |
FERG outperforms its industry in 2 out of 6 key metrics, particularly excelling in ROA, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Ferguson plc's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
52.76%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
77.66%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
64.73%
Industry Style: Cyclical, Value, Infrastructure
High Growth