FERGUSON ENTERPRISES INC (FERG) Stock Fundamental Analysis
NYSE:FERG - New York Stock Exchange, Inc. - US31488V1070 - Common Stock - Currency: USD
Overall FERG gets a fundamental rating of 5 out of 10. We evaluated FERG against 48 industry peers in the Trading Companies & Distributors industry. While FERG has a great profitability rating, there are some minor concerns on its financial health. FERG is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year FERG was profitable.
FERG had a positive operating cash flow in the past year.
In the past 5 years FERG has always been profitable.
FERG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
FERG has a better Return On Assets (9.31%) than 81.63% of its industry peers.
FERG has a Return On Equity of 29.05%. This is amongst the best in the industry. FERG outperforms 87.76% of its industry peers.
The Return On Invested Capital of FERG (16.68%) is better than 91.84% of its industry peers.
FERG had an Average Return On Invested Capital over the past 3 years of 19.52%. This is significantly above the industry average of 9.84%.
| 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
Looking at the Profit Margin, with a value of 5.32%, FERG is in the better half of the industry, outperforming 67.35% of the companies in the same industry.
In the last couple of years the Profit Margin of FERG has grown nicely.
Looking at the Operating Margin, with a value of 8.48%, FERG is in line with its industry, outperforming 59.18% of the companies in the same industry.
In the last couple of years the Operating Margin of FERG has grown nicely.
FERG has a Gross Margin of 30.46%. This is comparable to the rest of the industry: FERG outperforms 51.02% of its industry peers.
In the last couple of years the Gross Margin of FERG has remained more or less at the same level.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), FERG is creating value.
The number of shares outstanding for FERG has been reduced compared to 1 year ago.
The number of shares outstanding for FERG has been reduced compared to 5 years ago.
FERG has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 5.28 indicates that FERG is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 5.28, FERG is doing good in the industry, outperforming 79.59% of the companies in the same industry.
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 67.35% 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.
Looking at the Debt to Equity ratio, with a value of 0.67, FERG is in line with its industry, outperforming 48.98% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 2.95 | ||
| Altman-Z | 5.28 |
ROIC/WACC1.69
WACC9.88%
2.3 Liquidity
FERG has a Current Ratio of 1.64. This is a normal value and indicates that FERG is financially healthy and should not expect problems in meeting its short term obligations.
FERG has a Current ratio of 1.64. This is in the lower half of the industry: FERG underperforms 61.22% 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's Quick ratio of 0.88 is on the low side compared to the rest of the industry. FERG is outperformed by 71.43% 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%.
Measured over the past years, FERG shows a quite strong growth in Earnings Per Share. The EPS has been growing by 14.56% on average per year.
Looking at the last year, FERG shows a small growth in Revenue. The Revenue has grown by 2.32% in the last year.
The Revenue has been growing slightly by 6.13% on average over the past years.
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
The Earnings Per Share is expected to grow by 8.20% on average over the next years. This is quite good.
FERG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.54% yearly.
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
The Price/Earnings ratio is 23.63, which indicates a rather expensive current valuation of FERG.
The rest of the industry has a similar Price/Earnings ratio as FERG.
FERG's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.45.
The Price/Forward Earnings ratio is 20.88, which indicates a rather expensive current valuation of FERG.
The rest of the industry has a similar Price/Forward Earnings ratio as FERG.
When comparing the Price/Forward Earnings ratio of FERG to the average of the S&P500 Index (21.90), we can say FERG is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.63 | ||
| Fwd PE | 20.88 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of FERG is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of FERG indicates a somewhat cheap valuation: FERG is cheaper than 61.22% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.95 | ||
| EV/EBITDA | 16.4 |
4.3 Compensation for Growth
FERG has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.62
EPS Next 2Y5.05%
EPS Next 3Y7.2%
5. Dividend
5.1 Amount
FERG has a Yearly Dividend Yield of 1.49%. Purely for dividend investing, there may be better candidates out there.
FERG's Dividend Yield is a higher than the industry average which is at 2.34.
Compared to the average S&P500 Dividend Yield of 2.38, FERG is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.49% |
5.2 History
The dividend of FERG is nicely growing with an annual growth rate of 14.94%!
FERG has been paying a dividend for at least 10 years, so it has 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
FERG pays out 40.01% of its income as dividend. 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%
223.32
+1.92 (+0.87%)
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 Cap44.37B
Analysts78
Price Target232.94 (4.31%)
Short Float %1.16%
Short Ratio1.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.49% |
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)5.53%
EPS NY rev (1m)6.19%
EPS NY rev (3m)6.19%
Revenue NQ rev (1m)2.44%
Revenue NQ rev (3m)2.39%
Revenue NY rev (1m)1.39%
Revenue NY rev (3m)1.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.63 | ||
| Fwd PE | 20.88 | ||
| P/S | 1.47 | ||
| P/FCF | 31.95 | ||
| P/OCF | 25.61 | ||
| P/B | 8.02 | ||
| P/tB | 18.85 | ||
| EV/EBITDA | 16.4 |
EPS(TTM)9.45
EY4.23%
EPS(NY)10.69
Fwd EY4.79%
FCF(TTM)6.99
FCFY3.13%
OCF(TTM)8.72
OCFY3.91%
SpS152.04
BVpS27.84
TBVpS11.85
PEG (NY)N/A
PEG (5Y)1.62
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 | 5.28 |
F-Score4
WACC9.88%
ROIC/WACC1.69
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%