Ferguson Enterprises Inc. (NYSE:FERG) saw significant share price movement during recent months on the NYSE, rising to highs of US$223 and falling to the lows of US$188. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Ferguson Enterprises' current trading price of US$203 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at Ferguson Enterprises's outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

What Is Ferguson Enterprises Worth?

According to our valuation model, Ferguson Enterprises seems to be fairly priced at around 1.0% below our intrinsic value, which means if you buy Ferguson Enterprises today, you'd be paying a fair price for it. And if you believe that the stock is really worth $205.06, then there's not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since Ferguson Enterprises's share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of Ferguson Enterprises look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. Ferguson Enterprises' earnings over the next few years are expected to increase by 27%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? It seems like the market has already priced in FERG's positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven't considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you've been keeping an eye on FERG, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it's worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

So while earnings quality is important, it's equally important to consider the risks facing Ferguson Enterprises at this point in time. At Simply Wall St, we found 2 warning signs for Ferguson Enterprises and we think they deserve your attention.

If you are no longer interested in Ferguson Enterprises, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.