Here’s What Lifted Ferguson Enterprises (FERG) in Q2

Diamond Hill Capital, an investment management company, released its “Large Cap Fund” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. After a significant decline in April following President Trump’s “Liberation Day” tariffs announcement, markets recovered and increased consistently for the remainder of the quarter. The strategy modestly trailed the Russell 1000 Value Index in the second quarter and returned 2.87% (net) vs 3.79% for the index. The financial and consumer discretionary holdings lagged, while healthcare and communication services outperformed, boosting overall performance. To get an idea of the fund’s best choices for 2025, check out its top 5 positions.

In its second-quarter 2025 investor letter, Diamond Hill Large Cap 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 -0.67%, and its shares gained 12.95% of their value over the last 52 weeks. On August 7, 2025, Ferguson Enterprises Inc. (NYSE:FERG) stock closed at $222.90 per share, with a market capitalization of $44.733 billion.

Diamond Hill Large Cap Fund stated the following regarding Ferguson Enterprises Inc. (NYSE:FERG) in its second quarter 2025 investor letter:

“Other top Q2 contributors included Walt Disney, Ferguson Enterprises Inc. (NYSE:FERG) and Capital One Financial. Plumbing and heating products distributor Ferguson Enterprises is capitalizing on its competitive advantages to scale in large projects and the HVAC market. Furthermore, commodity deflation, a recent headwind, diminished in the quarter, providing a boost to shares. Given the still-fragmented industry and Ferguson’s status as a high-quality distributor in an industry where scale matters, we believe there is ample room for further margin expansion.”

Why Ferguson Enterprises Inc. (FERG) Skyrocketed On Tuesday

A busy warehouse stocked with a variety of industrial plumbing parts.

Ferguson Enterprises Inc. (NYSE:FERG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 75 hedge fund portfolios held Ferguson Enterprises Inc. (NYSE:FERG) at the end of the first quarter, which was 72 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 risk and potential of Ferguson Enterprises Inc. (NYSE:FERG) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Ferguson Enterprises Inc. (NYSE:FERG) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Ferguson Enterprises Inc. (NYSE:FERG) and shared Madison 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.