FERG Stock Forecast & Price Target

Ferguson Enterprises is projected to achieve total sales of $31.9 billion for FY'26, marking a 4% year-over-year increase, driven by strong performance in non-residential markets, which grew approximately 15%. The company’s gross margin improved to 31.7%, reflecting effective operational execution and favorable timing of supplier price increases. Additionally, Ferguson reported 6.9% growth in revenue and a 13.4% increase in adjusted operating profit for F4Q25, both exceeding estimates, underscoring the firm’s positive momentum within the North American market.

Ferguson Enterprises is experiencing a decline in HVAC revenues, attributed to affordability issues that have shifted customer preferences towards repair and servicing rather than replacement, coupled with challenging year-over-year comparisons. The residential end market remains stagnant, as demonstrated by flat year-over-year revenues and weak housing starts, which signal underlying weaknesses in the company's primary markets. Additionally, the company faces multiple risks, including potential deflation in key product lines, heightened competitive pressures due to slowing demand, and economic uncertainties that could adversely impact overall sales and growth strategies.