Ferguson Enterprises Inc (NYSE:FERG) stock rallied 14.38% (As on June 3, 11:23:33 AM UTC-4, Source: Google Finance) after the company reported a profit for third quarter that decreased from last year but beat the Street estimates. The company’s bottom line came in at $410 million, or $2.07 per share. This compares with $443 million, or $2.18 per share, last year.  Gross margin of 31.0% was 50 basis points above last year. The company continued to tightly manage the cost base with expense growth driven by higher volumes, cost inflation and continued selective investment in core capabilities for future growth. The company has reported adjusted operating profit of $715 million (9.4% adjusted operating margin) was 6.1% above last year.

Moreover, residential revenue grew approximately 2% in the third quarter. Non-residential end markets, representing just under half of US revenue, were stronger than residential end markets with increased activity on large capital projects. The company continued to grow share with non-residential revenue growth of approximately 7% in the third quarter. The company delivered mid to high-single digit growth across commercial and industrial end markets, with low double digit growth in the civil/infrastructure end markets. The company has completed two US acquisitions during the quarter, Independent Pipe & Supply Corp. and Light Innovations Inc.

Furthermore, net sales of Canada decreased by 0.3%, with organic revenue growth of 3.0%. Residential activity has continued to be soft with non-residential activity remaining more resilient. During the quarter the company had completed the acquisition of National Fire (collectively, National Fire Equipment Ltd. and National Fire Fabrication Ltd.).

FERG in the third quarter of FY25 has reported the adjusted earnings per share of $2.50, beating the analysts’ estimates for the adjusted earnings per share of $2.02. The company had reported the adjusted revenue growth of 4.3 percent to $7.62 billion in the third quarter of FY25, beating the analysts’ estimates for revenue of $7.42 billion. This is driven by organic revenue growth of 5.0% and acquisition growth of 1.0%, partially offset by 1.7% from the adverse impact of one fewer sales day and foreign exchange rates.

Additionally, Net debt to adjusted EBITDA at April 30, 2025 was 1.2x. During the quarter the company completed share repurchases of $251 million, bringing year to date repurchases to $759 million. The company have a remaining outstanding balance of approximately $1.1 billion under the current share repurchase program. The company has declared a quarterly dividend of $0.83 representing a 5% growth over prior year.