PARKER HANNIFIN CORP (PH)
US7010941042 - Common Stock
We assign a fundamental rating of 5 out of 10 to PH. PH was compared to 131 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. PH is quite expensive at the moment. It does show a decent growth rate.
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.
Each year in the past 5 years PH has been profitable.
In the past 5 years PH always reported a positive cash flow from operatings.
1.2 Ratios
PH has a Return On Assets of 9.77%. This is amongst the best in the industry. PH outperforms 80.31% of its industry peers.
Looking at the Return On Equity, with a value of 22.43%, PH belongs to the top of the industry, outperforming 86.61% of the companies in the same industry.
The Return On Invested Capital of PH (14.17%) is better than 81.89% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PH is in line with the industry average of 11.01%.
The last Return On Invested Capital (14.17%) for PH is above the 3 year average (11.38%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.77% | ||
| ROE | 22.43% | ||
| ROIC | 14.17% |
ROA(3y)7.24%
ROA(5y)7.28%
ROE(3y)19.53%
ROE(5y)19.82%
ROIC(3y)11.38%
ROIC(5y)10.72%
1.3 Margins
PH has a Profit Margin of 14.47%. This is amongst the best in the industry. PH outperforms 88.98% of its industry peers.
In the last couple of years the Profit Margin of PH has grown nicely.
With an excellent Operating Margin value of 20.12%, PH belongs to the best of the industry, outperforming 88.98% of the companies in the same industry.
In the last couple of years the Operating Margin of PH has grown nicely.
PH's Gross Margin of 36.08% is fine compared to the rest of the industry. PH outperforms 66.93% of its industry peers.
In the last couple of years the Gross Margin of PH has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.12% | ||
| PM (TTM) | 14.47% | ||
| GM | 36.08% |
OM growth 3Y5.61%
OM growth 5Y6.57%
PM growth 3Y5.45%
PM growth 5Y6.21%
GM growth 3Y2.6%
GM growth 5Y7.21%
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.
PH has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, PH has more shares outstanding
Compared to 1 year ago, PH has an improved debt to assets ratio.
2.2 Solvency
PH has an Altman-Z score of 5.23. This indicates that PH is financially healthy and has little risk of bankruptcy at the moment.
PH has a Altman-Z score of 5.23. This is in the better half of the industry: PH outperforms 77.17% of its industry peers.
PH has a debt to FCF ratio of 3.31. This is a good value and a sign of high solvency as PH would need 3.31 years to pay back of all of its debts.
The Debt to FCF ratio of PH (3.31) is better than 65.35% of its industry peers.
A Debt/Equity ratio of 0.52 indicates that PH is somewhat dependend on debt financing.
PH has a Debt to Equity ratio (0.52) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | 3.31 | ||
| Altman-Z | 5.23 |
ROIC/WACC1.58
WACC8.95%
2.3 Liquidity
A Current Ratio of 0.96 indicates that PH may have some problems paying its short term obligations.
PH has a Current ratio of 0.96. This is amonst the worse of the industry: PH underperforms 91.34% of its industry peers.
PH has a Quick Ratio of 0.96. 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 Quick ratio of 0.57. This is amonst the worse of the industry: PH underperforms 91.34% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.76% over the past year.
Measured over the past years, PH shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.50% on average per year.
The Revenue has been growing slightly by 1.56% in the past year.
PH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.83% yearly.
EPS 1Y (TTM)12.76%
EPS 3Y19.18%
EPS 5Y16.5%
EPS Q2Q%4.03%
Revenue 1Y (TTM)1.56%
Revenue growth 3Y11.58%
Revenue growth 5Y6.83%
Sales Q2Q%1.17%
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 8.39% yearly.
The Revenue is expected to grow by 6.06% on average over the next years.
EPS Next Y8.83%
EPS Next 2Y9.33%
EPS Next 3Y9.24%
EPS Next 5Y8.39%
Revenue Next Year2.32%
Revenue Next 2Y3.68%
Revenue Next 3Y4.36%
Revenue Next 5Y6.06%
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
With a Price/Earnings ratio of 27.42, PH can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of PH is on the same level as its industry peers.
When comparing the Price/Earnings ratio of PH to the average of the S&P500 Index (28.96), we can say PH is valued inline with the index average.
PH is valuated rather expensively with a Price/Forward Earnings ratio of 23.15.
PH's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of PH to the average of the S&P500 Index (23.82), we can say PH is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.42 | ||
| Fwd PE | 23.15 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PH indicates a slightly more expensive valuation: PH is more expensive than 61.42% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as PH.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.36 | ||
| EV/EBITDA | 19.99 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PH has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.1
PEG (5Y)1.66
EPS Next 2Y9.33%
EPS Next 3Y9.24%
5. Dividend
5.1 Amount
PH has a yearly dividend return of 0.93%, which is pretty low.
PH's Dividend Yield is a higher than the industry average which is at 1.54.
Compared to an average S&P500 Dividend Yield of 2.23, PH's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.93% |
5.2 History
The dividend of PH is nicely growing with an annual growth rate of 13.91%!
PH has paid a dividend for at least 10 years, which is 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)13.91%
Div Incr Years7
Div Non Decr Years33
5.3 Sustainability
PH pays out 27.72% 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.
DP27.72%
EPS Next 2Y9.33%
EPS Next 3Y9.24%
PARKER HANNIFIN CORP
NYSE:PH (11/21/2024, 9:57:38 PM)
After market: 702.68 0 (0%)702.68
+12.25 (+1.77%)
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 Cap90.45B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.93% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
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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)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.42 | ||
| Fwd PE | 23.15 | ||
| 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)3.1
PEG (5Y)1.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.77% | ||
| ROE | 22.43% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 20.12% | ||
| PM (TTM) | 14.47% | ||
| GM | 36.08% | ||
| 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 Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.57 | ||
| 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)12.76%
EPS 3Y19.18%
EPS 5Y
EPS Q2Q%
EPS Next Y8.83%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)1.56%
Revenue growth 3Y11.58%
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