Ferguson Enterprises (FERG) Surged Due to Improved Market Sentiment

Artisan Partners, an investment management company, released its “Artisan Mid Cap Value Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the quarter, the fund’s Investor Class fund ARTQX returned 0.26%, Advisor Class fund APDQX posted a return of 0.26%, and Institutional Class fund APHQX returned 0.33%, compared to a 5.35% return for the Russell Midcap Value Index. Equity markets experienced heightened volatility followed by the announcement and subsequent pause of the so-called "Liberation Day" tariffs. The portfolio underperformed in the quarter due to the market’s preference for growth and the outperformance of more cyclical sectors and industries. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Artisan Mid Cap Value Fund highlighted stocks such as Ferguson Enterprises Inc. (NYSE:FERG). Ferguson Enterprises Inc. (NYSE:FERG) is a plumbing and heating products distributor. The one-month return of Ferguson Enterprises Inc. (NYSE:FERG) was 4.89%, and its shares gained 14.27% of their value over the last 52 weeks. On August 7, 2025, Ferguson Enterprises Inc. (NYSE:FERG) stock closed at $234.24 per share, with a market capitalization of $47.009 billion.

Artisan Mid Cap Value Fund stated the following regarding Ferguson Enterprises Inc. (NYSE:FERG) in its second quarter 2025 investor letter:

"On the positive side, nVent Electric, Pinterest and Ferguson Enterprises Inc. (NYSE:FERG) were top contributors. Ferguson (formerly Wolseley) is the largest US distributor of heating, plumbing and HVAC (heating, ventilation and air conditioning) products. We added Ferguson to the portfolio on April 10 near the depths of the post-Liberation Day market selloff. Ferguson’s stock price had fallen by about one-third from early December 2024 due to continued residential housing market softness as higher interest rates have slowed housing sales and renovations, as well as due to the broader fears around tariffs. These concerns gave us an attractive entry point to purchase a strong business that we believe should be able to compound value over time due to growing end markets and an ability to take market share. FERG was trading at 15X next 12-month estimates at the time of purchase, making it attractive for a business with a strong return on invested capital (ROIC). Ferguson’s size and scale allow it to produce solid economics, it’s well financed, and its management is well regarded. As of the end of June, the stock was back near its 2024 highs on improved market sentiment."

Ferguson Enterprises Inc. (NYSE:FERG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 77 hedge fund portfolios held Ferguson Enterprises Inc. (NYSE:FERG) at the end of the second quarter, which was 75 in the previous quarter. In the fiscal third quarter of 2025, Ferguson Enterprises Inc. (NYSE:FERG) reported $7.6 billion in sales, an increase of 4.3% over prior year. While we acknowledge the potential of Ferguson Enterprises Inc. (NYSE:FERG) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Ferguson Enterprises Inc. (NYSE:FERG) and shared Diamond Hill Large Cap Fund's views on the company. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.