FERG Stock Forecast & Price Target

Ferguson Enterprises is projecting a 4% year-over-year increase in total sales for FY’26, reaching approximately $31.9 billion, driven by a combination of price growth and operational efficiency. The firm has demonstrated strong performance in its non-residential market, with revenues increasing by around 15%, led by significant growth in commercial and civil/infrastructure sectors, while maintaining a gross margin of 31.7%, which is up 70 basis points year-over-year. Additionally, Ferguson's F4Q25 saw impressive growth in revenue and adjusted operating profit by 6.9% and 13.4% year-over-year, respectively, indicating robust operational execution and sound financial health.

Ferguson Enterprises is experiencing a negative outlook primarily due to a 1% decline in HVAC revenues driven by a shift towards repair and servicing amid ongoing affordability issues, coupled with challenging year-on-year comparisons. The company has reported flat residential end market revenues, reflecting weak housing starts and stagnant repair, maintenance, and improvement spending, which further exacerbates the revenue pressures. Additionally, considerable risks exist, including potential deflation in key product categories, competitive pressure from a slowing demand environment, and a deepening housing downturn, all of which could hinder the firm’s ability to maintain margins and execute its growth strategy effectively.