Ferguson is acquiring FloWorks, a valves and flow control distributor, for $1.6 billion while raising its fiscal 2026 adjusted operating margin guidance to a range of 9.5% to 9.8%, the company announced on August 10.
The deal expands Ferguson's total addressable market to $400 billion and adds non-residential valve and flow control capabilities to its industrial distribution portfolio. Ferguson said the acquisition is expected to be accretive to adjusted earnings per share in the first full year post-close.
Ferguson, which generated $39.6 billion in revenue in the fiscal year ended July 31, 2025, operates as a distributor of HVAC, plumbing, and industrial products across multiple geographies. The company's FY2026 guidance represents an increase from its prior target.
The company also reported second-quarter results, with earnings and revenue figures tracking its growth targets. Ferguson's margin expansion comes from both organic operational improvements and the contribution of recent acquisitions to its bottom line.
The FloWorks acquisition adds a player in the industrial valve market at a time when consolidated distributors are pursuing bolt-on deals to deepen specialized capabilities. Ferguson has used acquisitions to broaden its addressable markets and cross-sell opportunities within its existing customer base. The company expects to fund the transaction through cash and available capital.
Ferguson's FY2026 margin guidance of 9.5% to 9.8% represents roughly 50 to 80 basis points of improvement over its fiscal 2025 adjusted operating margin. The company will report full fiscal 2026 results in September 2026.
