Sean — Josh has spoken about Ferguson Enterprises Inc (FERG) before. It's the largest distributor of plumbing and HVAC products in North America. Ferguson operates through a network of over 1,500 locations and thousands of delivery vehicles across the U.S. and Canada. But Ferguson isn't just an industrial. The company is also building a strong digital presence through its e-commerce platforms and value-added services, with a growing on-site consultation and logistics support program. Best Stock Spotlight: Ferguson Enterprises Inc (FERG) On the list since: 6/4/2025 Sean — FERG was on our list coming into its earnings report in December of 2024 (earnings reports marked by the purple 'E' below). In that report, there were a few bad metrics that spooked the market. Operating margin dropped to 9.1% from 10%, and EBITDA declined, bringing net income down with it. The market priced this earnings reduction in, and we saw a precipitous decline in price, dragging the stock below its 200 day moving average, and effectively removing it from our list: The stock has spent the last 6 months climbing back. The chart looks better and the fundamentals do too, just in time to make it back on our list. Notice the continued downtrend after the drop in earnings (there was also a trade war thrown in the mix), but this is an example of momentum, a key driver of our process. Stocks that go up tend to continue to go up. Stocks that are going down tend to continue to go down. When there is a sustainable break in either direction, that's where we see names getting dropped or added to our list. FERGs last earnings report in June was one of those turning points in the trend. During their last report in June, FERG beat Wall Street's expectations for revenue and EPS. EBITDA grew 20% year-over-year. This time, margins improved with operating margins growing 20 basis points to 9.4%. Net sales were up 4.3% year-over-year, the dividend was increased by 5%, and the company cut down on costs (800 positions were eliminated during a company-wide restructuring), which is estimated to save the company $100 million on an annualized basis. (data via Quartr). The growth is expected to continue too. Via management, sales are expected to grow low to mid single digits with operating margins stabilizing. FERG also bought back $759 million worth of shares in 2025, with another $1.1 billion authorized. FERG has staged a meaningful comeback since it dropped off our list. The company has rebounded with improving fundamentals, stronger margins, and a cleaner cost structure. The June earnings report marked a turning point in fundamentals, and we're seeing momentum behind the name. Risk Management Josh — FERG appears to be forming a textbook cup-and-handle pattern, signaling potential for bullish momentum. The stock has been consolidating in a tight range between $220 and $225, you can see a ton of sideways chop in this area. A decisive breakout above this $220 - $225 level, especially on strong volume — would be a meaningful development. The $200 level serves as a logical trailing stop. It aligns with the top of the gap-down candle from earlier this year and also represents the bottom of the large gap-up candle from this spring, effectively creating a line of support. Holding above this level keeps the bullish set-up intact, while a break below could suggest a change in trend. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. INVESTING INVOLVES RISK. EXAMPLES OF ANALYSIS CONTAINED IN THIS ARTICLE ARE ONLY EXAMPLES. THE VIEWS AND OPINIONS EXPRESSED ARE THOSE OF THE CONTRIBUTORS AND DO NOT NECESSARILY REFLECT THE OFFICIAL POLICY OR POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC. JOSH BROWN IS THE CEO OF RITHOLTZ WEALTH MANAGEMENT AND MAY MAINTAIN A SECURITY POSITION IN THE SECURITIES DISCUSSED. ASSUMPTIONS MADE WITHIN THE ANALYSIS ARE NOT REFLECTIVE OF THE POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC" TO THE END OF OR OUR DISCLOSURE. Click here for the full disclaimer.
