PARKER HANNIFIN CORP (PH)
US7010941042 - Common Stock
Taking everything into account, PH scores 6 out of 10 in our fundamental rating. PH was compared to 132 industry peers in the Machinery industry. While PH belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. While showing a medium growth rate, PH is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year PH was profitable.
PH had a positive operating cash flow in the past year.
Each year in the past 5 years PH has been profitable.
PH had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PH has a Return On Assets of 9.36%. This is in the better half of the industry: PH outperforms 75.97% of its industry peers.
With an excellent Return On Equity value of 23.88%, PH belongs to the best of the industry, outperforming 86.05% of the companies in the same industry.
With an excellent Return On Invested Capital value of 14.39%, PH belongs to the best of the industry, outperforming 82.95% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for PH is in line with the industry average of 10.68%.
The last Return On Invested Capital (14.39%) for PH is above the 3 year average (10.93%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.36% | ||
| ROE | 23.88% | ||
| ROIC | 14.39% |
ROA(3y)6.87%
ROA(5y)7.06%
ROE(3y)18.61%
ROE(5y)20.18%
ROIC(3y)10.93%
ROIC(5y)10.56%
1.3 Margins
PH has a Profit Margin of 13.95%. This is amongst the best in the industry. PH outperforms 86.05% of its industry peers.
PH's Profit Margin has improved in the last couple of years.
PH has a better Operating Margin (19.66%) than 88.37% of its industry peers.
In the last couple of years the Operating Margin of PH has grown nicely.
PH has a better Gross Margin (35.89%) than 68.22% of its industry peers.
PH's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.66% | ||
| PM (TTM) | 13.95% | ||
| GM | 35.89% |
OM growth 3Y9.97%
OM growth 5Y3.36%
PM growth 3Y7.46%
PM growth 5Y8.05%
GM growth 3Y10.11%
GM growth 5Y6.17%
2. Health
2.1 Basic Checks
PH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for PH remains at a similar level compared to 1 year ago.
The number of shares outstanding for PH has been reduced compared to 5 years ago.
Compared to 1 year ago, PH has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.30 indicates that PH is not in any danger for bankruptcy at the moment.
PH has a better Altman-Z score (4.30) than 69.77% of its industry peers.
The Debt to FCF ratio of PH is 3.87, which is a good value as it means it would take PH, 3.87 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of PH (3.87) is comparable to the rest of the industry.
PH has a Debt/Equity ratio of 0.63. This is a neutral value indicating PH is somewhat dependend on debt financing.
The Debt to Equity ratio of PH (0.63) is worse than 62.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 3.87 | ||
| Altman-Z | 4.3 |
ROIC/WACC1.63
WACC8.81%
2.3 Liquidity
PH has a Current Ratio of 0.87. This is a bad value and indicates that PH is not financially healthy enough and could expect problems in meeting its short term obligations.
PH has a Current ratio of 0.87. This is amonst the worse of the industry: PH underperforms 93.02% of its industry peers.
PH has a Quick Ratio of 0.87. This is a bad value and indicates that PH is not financially healthy enough and could expect problems in meeting its short term obligations.
PH's Quick ratio of 0.50 is on the low side compared to the rest of the industry. PH is outperformed by 86.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.5 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.96% over the past year.
PH shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.89% yearly.
PH shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.26%.
Measured over the past years, PH shows a small growth in Revenue. The Revenue has been growing by 5.92% on average per year.
EPS 1Y (TTM)19.96%
EPS 3Y25.93%
EPS 5Y15.89%
EPS growth Q2Q9.78%
Revenue 1Y (TTM)9.26%
Revenue growth 3Y11.66%
Revenue growth 5Y5.92%
Revenue growth Q2Q0.25%
3.2 Future
PH is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.92% yearly.
The Revenue is expected to grow by 5.46% on average over the next years.
EPS Next Y16.97%
EPS Next 2Y12.38%
EPS Next 3Y11.45%
EPS Next 5Y9.92%
Revenue Next Year4.76%
Revenue Next 2Y4.73%
Revenue Next 3Y4.78%
Revenue Next 5Y5.46%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 22.49 indicates a rather expensive valuation of PH.
PH's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of PH to the average of the S&P500 Index (28.11), we can say PH is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 20.45, the valuation of PH can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PH is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 20.39. PH is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.49 | ||
| Fwd PE | 20.45 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as PH.
The rest of the industry has a similar Price/Free Cash Flow ratio as PH.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.26 | ||
| EV/EBITDA | 16.98 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of PH may justify a higher PE ratio.
PEG (NY)1.33
PEG (5Y)1.42
EPS Next 2Y12.38%
EPS Next 3Y11.45%
5. Dividend
5.1 Amount
PH has a Yearly Dividend Yield of 1.18%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.72, PH pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.18, PH pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.18% |
5.2 History
The dividend of PH is nicely growing with an annual growth rate of 14.73%!
PH has paid a dividend for at least 10 years, which is a reliable track record.
PH has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.73%
Div Incr Years7
Div Non Decr Years15
5.3 Sustainability
PH pays out 27.54% of its income as dividend. This is a sustainable payout ratio.
PH's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP27.54%
EPS Next 2Y12.38%
EPS Next 3Y11.45%
PARKER HANNIFIN CORP
NYSE:PH (5/8/2024, 9:30:03 AM)
555.48
+5.3 (+0.96%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap71.33B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.18% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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Revenue beat(2)
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PT rev (1m)
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EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.49 | ||
| Fwd PE | 20.45 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.33
PEG (5Y)1.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.36% | ||
| ROE | 23.88% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 19.66% | ||
| PM (TTM) | 13.95% | ||
| GM | 35.89% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.67
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.5 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)19.96%
EPS 3Y25.93%
EPS 5Y
EPS growth Q2Q
EPS Next Y16.97%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)9.26%
Revenue growth 3Y11.66%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y