Ferguson Earnings: Acquisitions Continue to Support Growth Amid Softer Residential Markets

There were no surprises in Ferguson’s fiscal third-quarter results (ended April 30). While reported revenue growth of 2.4% came in a tad below our forecast of 3% growth, Ferguson’s 30.5% gross margin bested our forecast by 50 basis points. Stronger operating margin and lower interest expense led to Ferguson’s adjusted EPS of $2.32 beating our projection by approximately 6%.