Ferguson Enterprises Inc. (NYSE: FERG ) shares are trading lower after the company reported first-quarter results .
The company reported net sales of $7.77 billion, which was 0.8% higher year over year, missing the consensus of $7.83 billion.
Organic revenue fell by 0.3%, with a 1.1% negative impact from acquisition growth. Net sales in the U.S. business increased by 0.5%, while that in Canada grew by 6.3%.
Gross margin contracted by 10 basis points to 30.1% in the first quarter. Adjusted operating margin contracted to 9.1% from 10% a year ago quarter.
Adjusted EBITDA declined to $758 million from $819 million a year ago quarter. Adjusted EPS of $2.45, missing the consensus of $2.62 .
The company declared a quarterly dividend per share of $0.83, representing a growth of 5% over prior year. The dividend will be paid on February 6 to stockholders of record as of December 20, 2024.
Ferguson repurchased shares worth $256 million in the quarter, with around $600 million remaining under the current share repurchase program.
Outlook Reiterated: Ferguson expects FY25 net sales growth to be in low-single-digits, adjusted operating margin of 9.0% – 9.5%, and capital expenditures of $400 million – $450 million .
Kevin Murphy, Ferguson CEO, said, “While we anticipate an ongoing challenging near term market environment, we will continue to invest in scale and capabilities to take advantage of multi-year structural tailwinds such as underbuilt and aging U.S. housing, non-residential large capital projects and our opportunity with the plumbing and HVAC specialized professional.”
Investors can gain exposure to the stock via Invesco Water Resources ETF (NASDAQ: PHO ) and Global X Clean Water ETF (NASDAQ: AQWA ).
Price Action: FERG shares are down 9.82% at $196.36 at the last check Tuesday.
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This article Ferguson Maintains FY25 Guidance Amid Tough Market, Q1 Misses Estimates originally appeared on Benzinga.com
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