The basic story at Ferguson plc (OTCQX:FERGY) is a good business getting better in a market that is improving, but is still lumpy and fragile. Relative to my article from just a couple of days ago, the company delivered better-than-expected fiscal fourth-quarter results and commentary on underlying markets that I believe was better than many analysts and investors expected, but maybe more in line with what they hoped.
Ferguson goes into fiscal 2021 with a healthy balance sheet, a willingness to resume M&A, and ongoing share growth opportunities across its primary U.S. market. A weaker commercial construction market is a threat, but one that I think is increasingly well-understood by the market, and the residential market remains quite healthy. I’ve raised my expectations a bit (more over the next 12-24 months rather than long term), and I still believe that there’s an argument for Ferguson shares closing the valuation gap with other more highly valued names in the distribution space.
Read the full article here:
Ferguson Delivers A Better Quarter And Relatively Bullish Commentary
No comments:
Post a Comment