We recently published a list of Billionaire Nelson Peltz’s 8 Stock Picks with Highest Upside Potential. In this article, we are going to take a look at where Ferguson Enterprises Inc. (NYSE:FERG) stands against other billionaire Nelson Peltz’s stock picks with highest upside potential.
Nelson Peltz is one of the renowned figures in the financial world mainly due to his role as a billionaire who has served as a board member of some large corporations and also due to being the co-founder of Trian Fund Management. As per Forbes, his current net worth is $1.6 billion whereas Trian Fund Management has around $8.5 billion as assets under management.
Nelson Peltz was born in 1942 and entered the business world through his family’s wholesale food distribution company A. Peltz & Sons. He started his journey as a delivery truck driver and later transformed the company with his brother Peter May. Peltz shifted the gears of his family business by transitioning its focus to international frozen foods and launched a new brand called Flagstaff Corp, which later went public and was sold for $150 million in 1972.
Later, Peltz turned his modest income to build a multi-million fortune by a series of bold moves, starting with leveraged buyouts financed with junk bonds. For reference, junk bonds are bonds with a higher risk of default as compared to other bonds issued by corporations and governments. However, because of this higher risk investors are compensated with lucrative interest rates, therefore junk bonds are also high-yield bonds.
Notably, Peltz acquired Triangle Industries in 1983 and later sold it for $4 billion 5 years later. He also acquired Snapple, turned its business to profitability, and sold it 3 years later at a significant upside. These numerous acquisitions of underperforming and undervalued businesses, being sold at profitability, demonstrate his ability to fix businesses. Nelson Peltz has a famous quote that says:
“I spent most of my career operating businesses and fixing businesses, not staring at a Bloomberg screen.”
The form of investment that billionaire Peltz follows is known as Activist Investment, which essentially means an investor or a group of investors buys a stake in a public company to influence the operations of the company. Mostly, activist investors do this by taking a seat on the board of directors. Peltz defines an activist investor in a quote that says:
“The activists play the balance sheet by selling a division to buy back stock and leveraging the balance sheet and buying back more stock.”
Currently, Peltz is the co-founder of Trian Fund and also serves on the boards of some major public corporations. As of March 2024, Trian Fund Management oversees discretionary assets totaling $6,202,444,791 for 25 clients.
Our Methodology
To compile the list of billionaire Nelson Peltz’s 8 stock picks with the highest upside potential, we sifted through 13F filings of Trian Partners, from Insider Monkey. From these filings, we checked each stock’s upside potential from CNN and ranked the stocks in ascending order of the upside potential. We have also added the Trian Partners stake in each company and the hedge fund sentiment around each stock. Please note that the data was recorded on April 21, 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A busy warehouse stocked with a variety of industrial plumbing parts.
Ferguson Enterprises Inc. (NYSE:FERG)
Trian Partners’ Stake: $214,753,648
Number of Hedge Fund Holders: 72
Analyst Upside Potential: 20.38%
Ferguson Enterprises Inc. (NYSE:FERG) is one of the largest distributors of heating, plumbing, ventilation, air conditioning, and other related products in North America. It operates by serving residential and non-residential contractors to supply value-added construction and renovation products.
On April 16, Ferguson Enterprises Inc. (NYSE:FERG) announced two major acquisitions including Independent Pipe & Supply Corp. and National Fire Equipment Ltd. along with National Fire Fabrication Ltd. These acquisitions are anticipated to enhance the company’s business in commercial and fire & fabrication business while expanding the market position in both the US and Canada.
The company on March 11, released its second-quarter results, highlighting sales growth of 3% to reach $6.9 billion. Management noted that while the sales volume increased by 5%, it was partly offset by the continued deflation. As a result, the company has also adjusted its full-year operating margins outlook for the year from 9.0% – 9.5% to 8.3% – 8.8%. Nevertheless, Parnassus Core Equity Fund in its Q4 2024 investor letter stated that Ferguson Enterprises Inc. (NYSE:FERG) is expected to benefit from the tailwinds of the housing shortage and aging infrastructure. Here’s what the fund said about the company:
“We also added Industrials sector holding Ferguson Enterprises Inc. (NYSE:FERG), a leading distributor of plumbing supplies and construction equipment. Ferguson’s highly efficient operations, extensive distribution networks and broad product offerings give the company clear leadership over smaller, local competitors. Ferguson’s scale advantages are expected to increase as it consolidates the fragmented industry structure. Additionally, the structural tailwinds of aging infrastructure and housing shortages should support Ferguson’s long-term organic growth. Led by a tenured management team with a strong track record, the company is well positioned going forward, we believe.”
Overall, FERG ranks 5th on our list of billionaire Nelson Peltz’s stock picks with highest upside potential. While we acknowledge the potential of FERG to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than FERG but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
