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If you pull up your buddy's wishlist and find the book, you will see a button that says "Post This Book". By clicking that button, the system will specify that you are posting that book to that person.
If your buddy's account is on vacation hold, you will not see a Post This Book button.
Make sure your account is also not on hold. I made that mistake once. I had my account on hold because I was moving and didn't want any WL offers. But I wanted to send out books. I was going to post multiple books to a buddy. But I forgot to come off hold first and even though it said "you are posting this book to x person" it went on my shelf on hold. THen when I unheld my account it went to FIFO and not my buddy.
Just thought I'd mention that.
Also you need to be on their WL and not the book description page. Once you click on teh book description it takes you away from their WL and put it to FIFO.