William Blair analyst Ryan Merkel has maintained their bullish stance on FERG stock, giving a Buy rating yesterday.
Ryan Merkel has given his Buy rating due to a combination of factors that highlight Ferguson PLC’s strategic positioning and potential for recovery. Despite the recent challenges with gross margins and a cut in EBIT margin guidance, Merkel sees the company’s focus on key growth areas as a positive indicator. The company’s commitment to investing in HVAC, waterworks, and megaprojects is expected to drive market share gains even amidst a downturn.
Furthermore, while the operating margin is currently under pressure due to SG&A expenses, Merkel is optimistic about Ferguson’s ability to recover margins through strategic cost actions and seasonal factors. The anticipated improvement in pricing in the latter half of the year, along with potential tariff benefits, supports the view that Ferguson is well-positioned to stabilize and grow. Overall, Merkel believes that Ferguson’s targeted investments and market focus will yield favorable outcomes in the medium to long term.
According to TipRanks, Merkel is a 4-star analyst with an average return of 9.2% and a 56.38% success rate. Merkel covers the Industrials sector, focusing on stocks such as Aaon, Beacon Roofing Supply, and Fastenal Company.
In another report released yesterday, Barclays also maintained a Buy rating on the stock with a $211.00 price target.
