Share count
199Mpeak FY2022
← All companies ← FENC Manual FET → ← FAST Trading Companies & Distributors FSTR →
FERG, Ferguson Enterprises
Trading Companies & Distributors capital-intensive
Ferguson buys plumbing, heating and cooling, and waterworks parts from many makers and resells them to the trade — contractors, builders, and city water departments — out of a wide network of branches and warehouses. It makes nothing itself; it keeps the right pipe, valve, or fitting on the shelf and gets it to a job site fast. The money comes from a markup on each part, multiplied across a deep catalog and a fragmented base of working customers.
We help make our customers' complex projects simple, successful and sustainable by providing expertise and a wide range of products and services from plumbing, heating, ventilation and air conditioning ("HVAC"), appliances, and lighting to pipes, valves and fittings ("PVF"), water and wastewater solutions and more.
We sell through a common network of distribution centers, branches, counter service and expert sales associates, showroom consultants and e-commerce channels.
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2025
$30.8B
+3.8% YoY · 2% 3-yr CAGR
Vital signs · TTM, with 4-yr average
Revenue $30.8B 4-yr avg $29.7B
Revenue $7.5B +3.6% vs yr-ago qtr
Operating margin 8.2% yr-ago 7.0%
Net income $414M yr-ago $345M
Net margin 5.5% yr-ago 4.8%
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What it is
- Revenue is United States (95%) and Canada (5%).
- What moves the needle
- This is a distributor, so the lever is service and availability, not manufacture: a contractor with a crew waiting pays for the part that is in stock and arrives on time, and will keep coming back to the branch that never makes him hunt. Scale buys the breadth of inventory and the branch density that smaller rivals cannot match, and a fragmented market leaves room to roll up the stragglers. It leans franchise where reliability earns loyalty and a steady markup, commodity where a part is a part and price is all. The bad case: building slows, customers default, and the catalog turns into stranded stock. Whether breadth and service hold the margin shows in the returns on capital and debt in the record below.
- Is it a good business?
- Return on capital has run high across the record (median 21%, above 15% in 3 of 3 years). Owner earnings agree: roughly 5% of revenue reaches owners as cash, consistently. Whether these returns reflect real pricing power or an accounting artifact is the judgment the 10-K is for.
Drafted from the company's filings and reviewed by hand; every number is shown in full in the sections below.
Where the money comes from
read the 10-K →United States is 95% of revenue, so this is largely a single-segment business.
Revenue by reportable segment, FY2025
- United States95%$29.3B
- Canada5%$1.5B
From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.
The record
Ten years of arithmetic, read across the cycle.
The record, 2022–2025
realized figures from each filing · older years to the left| 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMJul 2025 | |
|---|---|---|---|---|---|
| Income statement | |||||
| $28.6B | $29.7B | $29.6B | $30.8B | $30.8B | RevenueRevenue |
| 31% | 30% | 31% | 31% | 31% | Gross marginGross mgn |
| 20% | 20% | 20% | 21% | 21% | SG&A / revenueSG&A/rev |
| $2.8B | $2.7B | $2.7B | $2.6B | $2.6B | Operating incomeOp. inc. |
| 9.9% | 8.9% | 8.9% | 8.5% | 8.5% | Operating marginOp. mgn |
| $2.1B | $1.9B | $1.7B | $1.9B | $1.9B | Net incomeNet inc. |
| 22% | 23% | 30% | 23% | 23% | Effective tax rateTax rate |
| Cash flow & returns | |||||
| $1.1B | $2.7B | $1.9B | $1.9B | $1.9B | Operating cash flowOp. cash |
| $301M | $321M | $335M | $373M | $373M | DepreciationDeprec. |
| ($1.3B) | $462M | ($246M) | ($349M) | ($349M) | Working capital & otherWC & other |
| $290M | $441M | $372M | $305M | $305M | CapexCapex |
| 1.0% | 1.5% | 1.3% | 1.0% | 1.0% | Capex / revenueCapex/rev |
| $859M | $2.3B | $1.5B | $1.6B | $1.6B | Owner earningsOwner earn. |
| 3.0% | 7.7% | 5.1% | 5.2% | 5.2% | Owner earnings marginOE mgn |
| $859M | $2.3B | $1.5B | $1.6B | $1.6B | Free cash flowFCF |
| 3.0% | 7.7% | 5.1% | 5.2% | 5.2% | Free cash flow marginFCF mgn |
| $650M | $616M | $260M | $301M | $301M | AcquisitionsAcquis. |
| $538M | $711M | $784M | $489M | $489M | Dividends paidDiv. paid |
| $1.5B | $908M | $634M | $948M | — | BuybacksBuybacks |
| — | 25% | 21% | 21% | 22% | ROICROIC |
| 45% | 38% | 31% | 32% | 32% | Return on equityROE |
| 34% | 23% | 17% | 23% | 23% | Retained to equityRetained/eq |
| Balance sheet | |||||
| $771M | $601M | $571M | $674M | $820M | Cash & investmentsCash+inv |
| — | $3.6B | $3.6B | $4.0B | $3.7B | ReceivablesReceiv. |
| — | $3.9B | $4.2B | $4.5B | $4.7B | InventoryInvent. |
| — | $3.4B | $3.4B | $3.6B | $3.7B | Accounts payablePayables |
| — | $4.1B | $4.4B | $4.9B | $4.7B | Operating working capitalOper. WC |
| — | $9.1B | $9.4B | $10.1B | $10.2B | Current assetsCur. assets |
| — | $5.4B | $5.2B | $6.0B | $5.7B | Current liabilitiesCur. liab. |
| — | 1.7× | 1.8× | 1.7× | 1.8× | Current ratioCurr. ratio |
| $2.0B | $2.2B | $2.4B | $2.5B | $2.5B | GoodwillGoodwill |
| — | $16.0B | $16.6B | $17.7B | $17.8B | Total assetsAssets |
| — | $3.8B | $3.9B | $4.2B | $4.1B | Total debtDebt |
| — | $3.2B | $3.4B | $3.5B | $3.3B | Net debt / (cash)Net debt |
| 25.4× | 14.5× | 14.8× | — | 14.6× | Interest coverageInt. cov. |
| $4.7B | $5.0B | $5.6B | $5.8B | $5.9B | Shareholders’ equityEquity |
| 0.2% | 0.2% | 0.2% | 0.1% | 0.1% | Stock comp / revenueSBC/rev |
| Per share | |||||
| 219M | 207M | 204M | 199M | 195M | Shares out (diluted)Shares |
| $130.50 | $143.50 | $145.63 | $154.43 | $157.92 | Revenue / shareRev/sh |
| $9.69 | $9.12 | $8.53 | $9.32 | $9.53 | EPS (diluted)EPS |
| $3.92 | $11.01 | $7.38 | $8.05 | $8.23 | Owner earnings / shareOE/sh |
| $3.92 | $11.01 | $7.38 | $8.05 | $8.23 | Free cash flow / shareFCF/sh |
| $2.46 | $3.43 | $3.85 | $2.45 | $2.51 | Dividends / shareDiv/sh |
| $1.32 | $2.13 | $1.83 | $1.53 | $1.57 | Cap. spending / shareCapex/sh |
| $21.31 | $24.31 | $27.60 | $29.28 | $30.15 | Book value / shareBVPS |
Per-share growththe realized rate an owner's share compounded
| 3-yr | 5-yr | |
|---|---|---|
| Revenue / share | +5.8%/yr | +5.8%/yr (3-yr) |
| Owner earnings / share | +27.0%/yr | +27.0%/yr (3-yr) |
| EPS | −1.3%/yr | −1.3%/yr (3-yr) |
| Dividends / share | −0.0%/yr | −0.0%/yr (3-yr) |
| Capital spending / share | +4.9%/yr | +4.9%/yr (3-yr) |
| Book value / share | +11.2%/yr | +11.2%/yr (3-yr) |
The year, in the company's words
the filing →Verbatim from the 10-K's management discussion. Each sentence is shown only because its subject, direction, and stated figures check out against the filed numbers on this page. The words are the company's; the arithmetic is the record's.
- United States+3.8%
“United States Five months ended December 31, (In millions) 2025 2024 Net sales $12,200 $11,662 Adjusted operating profit 1,160 975 Net sales for the United States segment were $12.2 billion in the transition period, an increase of $0.5 billion, or 4.6%, compared with the same period in the prior year. The increase in net sales was primarily driven by low to mid-single digit price inflation and incremental sales from acquisitions of 0.8%.”
✓ figure matches the filed record - Canada+3.7%
“Canada Five months ended December 31, (In millions) 2025 2024 Net sales $633 $617 Adjusted operating profit 18 30 Net sales for the Canada segment were $633 million in the transition period, an increase of $16 million, or 2.6%, compared with the same period in the prior year. This increase in net sales was primarily due to incremental sales from acquisitions of 4.8% and price inflation of low to mid single digits.”
✓ figure matches the filed record
The record, charted
FY2022–2025Each measure over its full record; the current point and the worst year marked.
ROIC
21%low FY2024
Gross margin
31%low FY2023
Net debt ÷ owner earnings
2.2×peak FY2024
Owner earnings vs. net income
Owner earningsNet incomeThe accountant's number, and the cash an owner can take; the gap is the tell.
$1.6Bowner earningsvs.$1.9Bnet incomelow FY2022
Where the cash went
ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cashEach year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.
FY2022FY2025
Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.
In fiscal 2025 the business reported $1.9B of profit but $1.6B of owner earnings: $253M less than the profit line, taken out by capital spending and the timing of cash.
| FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|
| Reported net income | $1.9B | $1.7B | $1.9B | $2.1B |
| Depreciation & amortizationnon-cash charge added back | +$373M | +$335M | +$321M | +$301M |
| Stock-based compensationreal costnon-cash, but a real cost | +$28M | +$49M | +$51M | +$57M |
| Working capital & othertiming of cash in and out, other non-cash items | −$349M | −$246M | +$462M | −$1.3B |
| Cash from operations | $1.9B | $1.9B | $2.7B | $1.1B |
| Capital expenditurecash put back in to keep running and to grow | −$305M | −$372M | −$441M | −$290M |
| Owner earnings | $1.6B | $1.5B | $2.3B | $859M |
| Owner-earnings marginowner earnings ÷ revenue | 5% | 5% | 8% | 3% |
Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $28M), owner earnings is nearer $1.6B.
Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2025 10-KT · source on SEC EDGAR →
Will it survive?
- Can it pay its interest? 14.6×ComfortableOperating income $2.6B ÷ interest expense $179M
What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
- How heavy is the debt, net of cash? $3.5B · 1.3× operating profitModest net debtCash $674M − debt $4.2B
What this means
Netting $674M of cash and short-term investments against $4.2B of debt leaves $3.5B owed, about 1.3× a year's operating profit (1.6× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
- Long (60+ days)DSO 47 + DIO 77 − DPO 61 days
What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.
Is it a good business?
- High through the cycle3-yr median, range 21%–25%; 21% latest = NOPAT $2.0B ÷ invested capital $9.3BIndustry peers: median 15%
What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 3 years (it ran 21% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Solid through the cycle4-yr median margin, range 3%–8%; latest $1.6B = operating cash $1.9B − maintenance capex $305MIndustry peers: median 5%
What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 5% of revenue this year, a 5% median across 4 years. Treating stock comp as the real expense it is (less $28M of SBC) leaves $1.6B.
- Cash-backedCash from ops $1.9B ÷ net income $1.9B
In the filing’s words The filing leans on adjusted, non-GAAP earnings, but the GAAP profit is itself cash-backed — the adjustments are not papering over a cash shortfall here.
What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- Returns about halfDividends + buybacks $1.4B ÷ Owner Earnings $1.6B
What this means
Of $1.6B Owner Earnings, $1.4B (90%) went back to shareholders, $489M dividends, $948M buybacks. Net of $28M stock comp, the real buyback was about $920M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
- Investing or harvesting? 0.82×MaintainingCapex $305M ÷ depreciation $373M
What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Graham’s defensive tests · 1 of 3 met
Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.
- Adequate size PassRevenue ≥ $2B · $30.8B
What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity NearCurrent ratio ≥ 2× · 1.68×
What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt NearDebt ≤ working capital · $4.2B vs $4.1B WC
What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $9.42/share (latest year $9.57), the averaged base the calculator's gate runs on, and book value is $30.07/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Durability & moat, 2022–2025
Whether the record’s returns held, and what the capital reinvested earned.
- Profitable years 4 of 4
What this means
Never lost money over the record, the earnings stability Graham insisted on.
- Return on capital ≥ 15% 3 of 3 yrs
What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
- Operating margin 9% → 9% (2-yr avg ends)
In the filing’s words The margin has held, but the filing names price competition — the pressure is present even where the margin has absorbed it so far.
What this means
Through the cycle the operating margin held roughly steady — about 9% early, 9% lately, median 9%.
- Reinvestment, incremental ROIC returns capital
What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
- Owner earnings growth −0%/yr
What this means
Owner earnings shrank about 0% a year over the record.
- Worst year 2025 · 8.5% op. margin
What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
- Share count −3.1%/yr
What this means
The share count is shrinking, buybacks are quietly growing your slice of the business.
- Dividend record paid
What this means
Paid a dividend in 4 of the years on record.
- How management talks about it Owner’s terms
What this means
Returns have thinned, but the filing discusses it in an owner’s vocabulary rather than selling past it — candor about a hard stretch counts for more than an adjective.
Does AI threaten the moat?
Moderate contestabilityAI is likely to reshape costs and some products here without clearly contesting or sparing the core moat; how the company itself frames it is the tell.
In its own filing Named as a competitive risk
Its FY2025 10-K names artificial intelligence as a competitive threat.
“In addition, certain competitors may devote more resources to systems development and automation or respond more quickly to emerging technologies (such as generative AI) and changes in customer preferences than we do.”
The question is whether a moat the record shows as durable outlasts a technology that lowers the cost of part of what the firm sells. The durability is read in the record above, the filing's own framing of AI beside it; the industry label decides nothing on its own.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of the latest quarter, Mar 31, 2026Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$10.2B
- Cash & short-term investments$820M
- Receivables$3.7B
- Inventory$4.7B
- Other current assets$1.0B
Current liabilities$5.7B
- Debt due within a year$148M
- Accounts payable$3.7B
- Other current liabilities$1.9B
Current ratio1.78×all current assets ÷ what's due · Graham looked for 2×
Quick ratio0.96×stricter: inventory excluded
Cash ratio0.14×strictest: cash alone against what's due
Working capital$4.5Bthe cushion left after near-term bills
Debt due this year vs. cash$148M due · $820M cash
covered by cash on hand, no refinancing forced · both figures from the Mar 31, 2026 balance sheet
Revenue, latest quarter vs. a year ago+3.6%the freshest read on whether the business is still growing
Current ratio, recent quarters1.7× → 1.8×
Deeper floors
Tangible book value$2.7Bequity stripped of goodwill & intangibles
Net current asset value($1.8B)Graham's net-net: current assets less all liabilities
Debt incl. operating leases$6.1B$2.0B of it operating leases; with finance leases, “total fixed claims” below reaches $6.0B (annual-report basis)
From the company's latest filing.
Lease obligations
the lease note, SEC EDGAR →Debt by another name. What the business owes on the property, aircraft, stores and equipment it rents rather than owns is a fixed claim due on a schedule; added back to the debt, it is the true leverage. That ladder, and what it adds to the debt on the page above.
Lease payments by year, scaled to the largest; “later” is everything beyond year five, shown apart. These are the contractual cash payments, before the interest the filing imputes back out to the balance-sheet liability.
Due in the next 12 months$485Ma fixed cash payment, owed whether or not the business has a good year
Total lease payments$2.2Bevery year plus the tail, undiscounted: the full cash the leases will take
On the balance sheet$1.8Bthe present value of those payments, the recognised lease liability
True leverage: debt plus leases
On-balance-sheet debt$4.2B
Lease obligations (present value)$1.8B
Total fixed claims on the business$6.0B
Counting the leases the way Buffett does, the fixed claims on this business come to $6.0B, of which the leases are 30%. The lease wall above and the debt schedule together are the calendar of what must be paid, and when.
Lease ladder read from the ASC 842 tags in the company’s Jul 31, 2025 annual report and reconciled: the yearly buckets sum to the undiscounted total, which less the imputed interest equals the balance-sheet liability; a ladder that doesn’t tie out is withheld.
How the cash was used, 2022–2025
Over the record, the business generated $7.7B of operating cash; how management split it reads as a cash returner, paying most of what it earns straight back to owners.
- Reinvested$1.4B · 18%
- Dividends$2.5B · 33%
- Buybacks$4.0B · 53%
- Returned to owners$6.6B
105% of the owner earnings the business produced over the span, $2.5B as dividends and $4.0B as buybacks.
- Source of funding−$312M
Reinvestment and shareholder returns ran $312M beyond the operating cash the business generated, so the gap was financed off the balance sheet.
- Average price paid for buybacks—
Buybacks ran $4.0B over the span, but the filings don't tag the share count needed to deduce the average price paid.
- Net change in share count−11.0%
The diluted count fell from 219M to 195M, so the buybacks outran the stock issued to staff.
- Dividend record$2.45/sh
Paid in 4 of the years on record, the per-share dividend shrinking about 0% a year. It was cut at least once along the way.
- Return on what it retained24%
Of the earnings it kept rather than paid out ($1.0B over the span), annual owner earnings (first three years vs last three) grew $248M, so each retained $1 added about 0.24 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.
Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.
Management, ownership & pay
read the proxy →From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.
| Fiscal year | Chief executive | Pay, as filed | “Actually paid” | Owner earnings |
|---|---|---|---|---|
| 2021 | Kevin Murphy | $5.0M | $12.6M | — |
| 2022 | Kevin Murphy | $4.9M | $5.4M | $859M |
| 2023 | Kevin Murphy | $5.4M | $8.7M | $2.3B |
| 2024 | Kevin Murphy | $9.1M | $14.6M | $1.5B |
| 2025 | Kevin Murphy | $14.1M | $13.8M | $1.6B |
Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.
- Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
- Stock-based compensation$28M
The slice of the business handed to employees in shares this year, 0% of revenue, equal to 1% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
Inverting the record
Invert: instead of why Ferguson Enterprises is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2022–2025.
None of the 4 tests turned up a mark; each came back clean. A clean panel says only that these particular ways of being wrong are not written into the record.
Each test came back clean
- Is it less profitable than it was?
- Did the share count rise anyway?
- Did reported profit become cash?
- Are "one-time" charges a yearly habit?
Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.
What an owner would ask, FY2025
read the 10-K →- Which reported numbers are a judgment call?Management names Pension & retirement, Inventory as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →
The questions the record and the charts do not answer on their own; each carries the figure and the place to look.
Peers, Trading Companies & Distributors
The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| ARWArrow Electronics Inc. | $30.9B | 12% | 3.6% | 10% | 1% |
| FERGFerguson Enterprises | $30.8B | 31% | 8.9% | 21% | 5% |
| GPCGenuine Parts Company | $24.3B | 35% | 7.1% | 15% | 5% |
| WCCWESCO Intl | $23.5B | 20% | 4.5% | 8% | 2% |
| AVTAvnet Inc. | $22.2B | 12% | 2.3% | 7% | 1% |
| GWWW.W. Grainger Inc. | $17.9B | 39% | 11.9% | 29% | 8% |
| TELTE Connectivity plc | $17.3B | 33% | 16.3% | 15% | 13% |
| WSOWatsco | $7.2B | 26% | 9.1% | 21% | 7% |
| Group median | — | 28% | 8.0% | 15% | 5% |
The price
What a price has to assume.
What the price implies
reverse-DCFType today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Ferguson Enterprises has delivered.
$
Through the cycle, Ferguson Enterprises earns about $1.6B on its 5.1% median owner-earnings margin. This year’s 5.2% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.
Base
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The assumptions
9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.
Enter a price above to run it.
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Implied by the price—
Owner-earnings growth · ’22→’25−0%/yr
Owner-earnings growth · ’22→’25−0%/yr
Owner-earnings yield—
What a growth belief costs, in multiples
The growth each return requires, at your price
P/E (3-yr earnings ’23–’25)—
P/B—
Graham’s price gate—
Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.
Against a high-grade bond: Graham’s yardstick bond yield%
Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.
Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.
Owner-earnings yield—
High-grade bond yield—
Margin over the bond—
Owner earnings $1.6B on 194M shares outstanding, per the 10-Q cover, as of 2026-04-28; net debt $3.3B. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.
Cite: Owner Scorecard, "Ferguson Enterprises (FERG), the owner's record," https://ownerscorecard.com/c/FERG, data as of 2026-07-09.
Manual order: ← FENC its page in the Manual FET →
Industry order: ← FAST the Trading Companies & Distributors chapter FSTR →