Is Ferguson Plc overvalued or undervalued?

As of 4 September 2025, Ferguson Plc's valuation grade has moved from fair to expensive, indicating that the stock may be overvalued. The company is currently assessed with a P/E ratio of 25, a Price to Book Value of 7.63, and an EV to EBITDA of 15.72, which are relatively high compared to its peers. For instance, Fastenal Co. has a significantly higher P/E ratio of 46.51, while W.W. Grainger, Inc. stands at 52.61, suggesting that Ferguson is less expensive than these competitors but still appears overvalued within its own context.
The stock's performance has been mixed, with a year-to-date return of 32.05%, outperforming the S&P 500's 12.22% during the same period, but it lags behind the index over the longer term, particularly in the last 10 years where it returned 139.36% compared to the S&P 500's 231.64%. Overall, Ferguson Plc appears to be overvalued based on its current valuation ratios and the recent changes in its grade.