FERGUSON ENTERPRISES INC (FERG) Stock Fundamental Analysis
NYSE:FERG - New York Stock Exchange, Inc. - US31488V1070 - Common Stock - Currency: USD
Taking everything into account, FERG scores 5 out of 10 in our fundamental rating. FERG was compared to 48 industry peers in the Trading Companies & Distributors industry. FERG scores excellent on profitability, but there are some minor concerns on its financial health. While showing a medium growth rate, FERG is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
FERG had positive earnings in the past year.
In the past year FERG had a positive cash flow from operations.
In the past 5 years FERG has always been profitable.
Each year in the past 5 years FERG had a positive operating cash flow.
1.2 Ratios
The Return On Assets of FERG (9.31%) is better than 83.33% of its industry peers.
With an excellent Return On Equity value of 29.05%, FERG belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 16.68%, FERG belongs to the top of the industry, outperforming 91.67% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for FERG is significantly above the industry average of 9.66%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.31% | ||
| ROE | 29.05% | ||
| ROIC | 16.68% |
ROA(3y)11.94%
ROA(5y)10.74%
ROE(3y)37.96%
ROE(5y)33.06%
ROIC(3y)19.52%
ROIC(5y)17.16%
1.3 Margins
The Profit Margin of FERG (5.32%) is better than 68.75% of its industry peers.
In the last couple of years the Profit Margin of FERG has grown nicely.
FERG has a Operating Margin of 8.48%. This is in the better half of the industry: FERG outperforms 60.42% of its industry peers.
FERG's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 30.46%, FERG is in line with its industry, outperforming 50.00% of the companies in the same industry.
FERG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.48% | ||
| PM (TTM) | 5.32% | ||
| GM | 30.46% |
OM growth 3Y1.51%
OM growth 5Y5.66%
PM growth 3Y-3.22%
PM growth 5Y3.07%
GM growth 3Y-0.08%
GM growth 5Y0.8%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so FERG is creating value.
FERG has less shares outstanding than it did 1 year ago.
FERG has less shares outstanding than it did 5 years ago.
FERG has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 5.19 indicates that FERG is not in any danger for bankruptcy at the moment.
FERG's Altman-Z score of 5.19 is amongst the best of the industry. FERG outperforms 81.25% of its industry peers.
The Debt to FCF ratio of FERG is 2.95, which is a good value as it means it would take FERG, 2.95 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.95, FERG is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
FERG has a Debt/Equity ratio of 0.67. This is a neutral value indicating FERG is somewhat dependend on debt financing.
FERG has a Debt to Equity ratio (0.67) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 2.95 | ||
| Altman-Z | 5.19 |
ROIC/WACC1.67
WACC9.99%
2.3 Liquidity
A Current Ratio of 1.64 indicates that FERG should not have too much problems paying its short term obligations.
FERG has a worse Current ratio (1.64) than 60.42% of its industry peers.
FERG has a Quick Ratio of 1.64. This is a bad value and indicates that FERG is not financially healthy enough and could expect problems in meeting its short term obligations.
FERG has a Quick ratio of 0.88. This is in the lower half of the industry: FERG underperforms 70.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.64 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
FERG shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -0.32%.
The Earnings Per Share has been growing by 14.56% on average over the past years. This is quite good.
The Revenue has been growing slightly by 2.32% in the past year.
FERG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.13% yearly.
EPS 1Y (TTM)-0.32%
EPS 3Y12.31%
EPS 5Y14.56%
EPS Q2Q%7.76%
Revenue 1Y (TTM)2.32%
Revenue growth 3Y9.15%
Revenue growth 5Y6.13%
Sales Q2Q%4.28%
3.2 Future
FERG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.20% yearly.
Based on estimates for the next years, FERG will show a small growth in Revenue. The Revenue will grow by 7.54% on average per year.
EPS Next Y-0.7%
EPS Next 2Y5.05%
EPS Next 3Y7.2%
EPS Next 5Y8.2%
Revenue Next Year3.17%
Revenue Next 2Y4.36%
Revenue Next 3Y4.96%
Revenue Next 5Y7.54%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 22.75 indicates a rather expensive valuation of FERG.
FERG's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of FERG to the average of the S&P500 Index (26.65), we can say FERG is valued inline with the index average.
A Price/Forward Earnings ratio of 20.11 indicates a rather expensive valuation of FERG.
FERG's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.27, FERG is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.75 | ||
| Fwd PE | 20.11 |
4.2 Price Multiples
FERG's Enterprise Value to EBITDA ratio is in line with the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as FERG.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.76 | ||
| EV/EBITDA | 15.83 |
4.3 Compensation for Growth
FERG has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.56
EPS Next 2Y5.05%
EPS Next 3Y7.2%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.55%, FERG has a reasonable but not impressive dividend return.
FERG's Dividend Yield is a higher than the industry average which is at 3.41.
FERG's Dividend Yield is slightly below the S&P500 average, which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.55% |
5.2 History
On average, the dividend of FERG grows each year by 14.94%, which is quite nice.
FERG has paid a dividend for at least 10 years, which is a reliable track record.
FERG has decreased its dividend recently.
Dividend Growth(5Y)14.94%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
40.01% of the earnings are spent on dividend by FERG. This is a bit on the high side, but may be sustainable.
FERG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP40.01%
EPS Next 2Y5.05%
EPS Next 3Y7.2%
215
-0.04 (-0.02%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners95.61%
Inst Owner Change3.91%
Ins Owners2.47%
Ins Owner Change-0.64%
Market Cap42.72B
Analysts78.57
Price Target232.94 (8.34%)
Short Float %1.64%
Short Ratio1.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.55% |
Yearly Dividend3.87
Dividend Growth(5Y)14.94%
DP40.01%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)7.23%
Min EPS beat(2)-6.84%
Max EPS beat(2)21.31%
EPS beat(4)2
Avg EPS beat(4)2.1%
Min EPS beat(4)-8.26%
Max EPS beat(4)21.31%
EPS beat(8)3
Avg EPS beat(8)1.01%
EPS beat(12)5
Avg EPS beat(12)0.4%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)0.17%
Min Revenue beat(2)-0.33%
Max Revenue beat(2)0.67%
Revenue beat(4)1
Avg Revenue beat(4)-1.26%
Min Revenue beat(4)-2.7%
Max Revenue beat(4)0.67%
Revenue beat(8)2
Avg Revenue beat(8)-1.37%
Revenue beat(12)3
Avg Revenue beat(12)-1.22%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)17.62%
PT rev (3m)16.08%
EPS NQ rev (1m)5.5%
EPS NQ rev (3m)5.44%
EPS NY rev (1m)6.19%
EPS NY rev (3m)-0.16%
Revenue NQ rev (1m)2.44%
Revenue NQ rev (3m)2.22%
Revenue NY rev (1m)1.39%
Revenue NY rev (3m)1.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.75 | ||
| Fwd PE | 20.11 | ||
| P/S | 1.41 | ||
| P/FCF | 30.76 | ||
| P/OCF | 24.65 | ||
| P/B | 7.72 | ||
| P/tB | 18.15 | ||
| EV/EBITDA | 15.83 |
EPS(TTM)9.45
EY4.4%
EPS(NY)10.69
Fwd EY4.97%
FCF(TTM)6.99
FCFY3.25%
OCF(TTM)8.72
OCFY4.06%
SpS152.04
BVpS27.84
TBVpS11.85
PEG (NY)N/A
PEG (5Y)1.56
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.31% | ||
| ROE | 29.05% | ||
| ROCE | 22.68% | ||
| ROIC | 16.68% | ||
| ROICexc | 17.49% | ||
| ROICexgc | 24.8% | ||
| OM | 8.48% | ||
| PM (TTM) | 5.32% | ||
| GM | 30.46% | ||
| FCFM | 4.6% |
ROA(3y)11.94%
ROA(5y)10.74%
ROE(3y)37.96%
ROE(5y)33.06%
ROIC(3y)19.52%
ROIC(5y)17.16%
ROICexc(3y)20.83%
ROICexc(5y)19.21%
ROICexgc(3y)29.84%
ROICexgc(5y)27.75%
ROCE(3y)26.54%
ROCE(5y)23.43%
ROICexcg growth 3Y-2.31%
ROICexcg growth 5Y-1.42%
ROICexc growth 3Y-1.25%
ROICexc growth 5Y0.09%
OM growth 3Y1.51%
OM growth 5Y5.66%
PM growth 3Y-3.22%
PM growth 5Y3.07%
GM growth 3Y-0.08%
GM growth 5Y0.8%
F-Score4
Asset Turnover1.75
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 2.95 | ||
| Debt/EBITDA | 1.27 | ||
| Cap/Depr | 94.77% | ||
| Cap/Sales | 1.14% | ||
| Interest Coverage | 13.01 | ||
| Cash Conversion | 59.25% | ||
| Profit Quality | 86.43% | ||
| Current Ratio | 1.64 | ||
| Quick Ratio | 0.88 | ||
| Altman-Z | 5.19 |
F-Score4
WACC9.99%
ROIC/WACC1.67
Cap/Depr(3y)114.92%
Cap/Depr(5y)105.2%
Cap/Sales(3y)1.25%
Cap/Sales(5y)1.25%
Profit Quality(3y)82.6%
Profit Quality(5y)91.33%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.32%
EPS 3Y12.31%
EPS 5Y14.56%
EPS Q2Q%7.76%
EPS Next Y-0.7%
EPS Next 2Y5.05%
EPS Next 3Y7.2%
EPS Next 5Y8.2%
Revenue 1Y (TTM)2.32%
Revenue growth 3Y9.15%
Revenue growth 5Y6.13%
Sales Q2Q%4.28%
Revenue Next Year3.17%
Revenue Next 2Y4.36%
Revenue Next 3Y4.96%
Revenue Next 5Y7.54%
EBIT growth 1Y-2.25%
EBIT growth 3Y10.79%
EBIT growth 5Y12.13%
EBIT Next Year0.89%
EBIT Next 3Y6.74%
EBIT Next 5Y8.15%
FCF growth 1Y-23.43%
FCF growth 3Y9.57%
FCF growth 5Y11.47%
OCF growth 1Y-23.66%
OCF growth 3Y10.66%
OCF growth 5Y7.74%