Ferguson Enterprises Inc: Risk Reward Update

研报英文原文证据摘录

Ferguson Enterprises Inc: Risk Reward Update

UpdateM

RiskRisk RewardReward– Ferguson- FergusonEnterprises IncEnterprises(FERG.N) Inc (FERG.N)

Quality business, end markets recovering

PRICE TARGET US$290.00 OVERWEIGHT THESIS

ahead of the market: Ferguson isOur price target is derived from a DCF, in which we assume an 8.0% WACC and 2% terminal ▪Growth

growth rate. We cross-reference this with historical average and peer multiples. well positioned to continue delivering

market share gains through scale advantage, US$280.16

technology and a superior customer offer,

Consensus Price Target Distribution US$204.56 US$315.00 while margin upside should stem from rising

MS PT

own-brand sales and productivity gains.Source: Refinitiv, Morgan Stanley Research Mean Morgan Stanley Estimates ▪Less exposed to a cyclical downturn, with

two-thirds of revenues now RMI driven.

strong balance sheet offers optionality ▪A

RISK REWARD CHART for M&A and shareholder returns.

▪Valuation: Following good performance

USD YTD, the shares now trade more in line with

US$415.00US$415.00(+70.10%)US$415.00(+70.10%)(+70.10%) the US peer group.

400 Consensus Rating Distribution

73% Overweight

300 US$290.00US$290.00(+18.86%)US$290.00(+18.86%)(+18.86%) 27% Equal-weight

US$243.98US$243.98US$243.98 0% Underweight

200 MS Rating

US$200.00US$200.00(-18.03%)US$200.00(-18.03%)(-18.03%) Source: Refinitiv, Morgan Stanley Research

MAY '25 NOV '25 MAY '26 MAY '27

Key: Historical Stock Performance Current Stock Price Price Target

Source: Refinitiv, Morgan Stanley Research

BULL CASE US$415.00 BASE CASE US$290.00 BEAR CASE US$200.00

Stronger than expected growth and Market share gains and stable growth Economic growth and construction markets

margins contract

Our base case assumes MSD revenue