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 131 industry peers in the Machinery industry. PH scores excellent on profitability, but there are some minor concerns on its financial health. PH has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
PH had positive earnings in the past year.
PH had a positive operating cash flow in the past year.
In the past 5 years PH has always been profitable.
In the past 5 years PH always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 9.36%, PH is doing good in the industry, outperforming 75.97% of the companies in the same industry.
The Return On Equity of PH (23.88%) is better than 85.27% of its industry peers.
PH's Return On Invested Capital of 14.39% is amongst the best of the industry. PH outperforms 82.95% of its industry peers.
PH had an Average Return On Invested Capital over the past 3 years of 10.93%. This is in line with the industry average of 11.02%.
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's Profit Margin of 13.95% is amongst the best of the industry. PH outperforms 84.50% of its industry peers.
PH's Profit Margin has improved in the last couple of years.
The Operating Margin of PH (19.66%) is better than 86.82% of its industry peers.
In the last couple of years the Operating Margin of PH has grown nicely.
Looking at the Gross Margin, with a value of 35.89%, PH is in the better half of the industry, outperforming 65.89% of the companies in the same industry.
In the last couple of years the Gross Margin of PH has grown nicely.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), PH is creating some value.
The number of shares outstanding for PH remains at a similar level compared to 1 year ago.
Compared to 5 years ago, PH has less shares outstanding
PH has a better debt/assets ratio than last year.
2.2 Solvency
PH has an Altman-Z score of 4.28. This indicates that PH is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.28, PH is doing good in the industry, outperforming 70.54% of the companies in the same industry.
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.
PH has a better Debt to FCF ratio (3.87) than 61.24% of its industry peers.
A Debt/Equity ratio of 0.63 indicates that PH is somewhat dependend on debt financing.
The Debt to Equity ratio of PH (0.63) is worse than 64.34% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 3.87 | ||
| Altman-Z | 4.28 |
ROIC/WACC1.73
WACC8.33%
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 95.35% 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 has a worse Quick ratio (0.50) than 93.02% 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%.
PH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.92% yearly.
EPS 1Y (TTM)19.96%
EPS 3Y25.93%
EPS 5Y15.89%
EPS Q2Q%9.78%
Revenue 1Y (TTM)9.26%
Revenue growth 3Y11.66%
Revenue growth 5Y5.92%
Sales Q2Q%0.25%
3.2 Future
The Earnings Per Share is expected to grow by 10.26% on average over the next years. This is quite good.
Based on estimates for the next years, PH will show a small growth in Revenue. The Revenue will grow by 5.75% on average per year.
EPS Next Y18.93%
EPS Next 2Y12.55%
EPS Next 3Y11.7%
EPS Next 5Y10.26%
Revenue Next Year4.53%
Revenue Next 2Y4.42%
Revenue Next 3Y4.92%
Revenue Next 5Y5.75%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past 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 22.45 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 (24.41), we can say PH is valued inline with the index average.
The Price/Forward Earnings ratio is 20.35, which indicates a rather expensive current valuation of PH.
PH's Price/Forward Earnings ratio is in line with the industry average.
PH is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 20.59, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.45 | ||
| Fwd PE | 20.35 |
4.2 Price Multiples
PH's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PH indicates a somewhat cheap valuation: PH is cheaper than 60.47% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.24 | ||
| EV/EBITDA | 16.86 |
4.3 Compensation for Growth
PH's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PH has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.19
PEG (5Y)1.41
EPS Next 2Y12.55%
EPS Next 3Y11.7%
5. Dividend
5.1 Amount
PH has a Yearly Dividend Yield of 1.19%.
Compared to an average industry Dividend Yield of 1.67, PH pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.30, PH's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.19% |
5.2 History
The dividend of PH is nicely growing with an annual growth rate of 14.73%!
PH has been paying a dividend for at least 10 years, so it has a reliable track record.
PH has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.73%
Div Incr Years7
Div Non Decr Years33
5.3 Sustainability
27.54% of the earnings are spent on dividend by PH. This is a low number and sustainable payout ratio.
The dividend of PH is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP27.54%
EPS Next 2Y12.55%
EPS Next 3Y11.7%
PARKER HANNIFIN CORP
NYSE:PH (7/26/2024, 7:04:00 PM)
After market: 554.61 0 (0%)554.61
+9.48 (+1.74%)
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 Cap71.29B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.19% |
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)
PT rev (3m)
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 | 22.45 | ||
| Fwd PE | 20.35 | ||
| 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)1.19
PEG (5Y)1.41
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)
High Growth Momentum
Growth
EPS 1Y (TTM)19.96%
EPS 3Y25.93%
EPS 5Y
EPS Q2Q%
EPS Next Y18.93%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)9.26%
Revenue growth 3Y11.66%
Revenue growth 5Y
Sales 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