NYSE:PH

Stock Analysis Report

Executive Summary

Parker-Hannifin Corporation manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide.

Snowflake

Fundamentals

Solid track record established dividend payer.


Similar Companies

Share Price & News

How has Parker-Hannifin's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

5.1%

PH

3.2%

US Machinery

1.0%

US Market


1 Year Return

9.9%

PH

2.3%

US Machinery

6.7%

US Market

Return vs Industry: PH exceeded the US Machinery industry which returned 2.3% over the past year.

Return vs Market: PH exceeded the US Market which returned 6.7% over the past year.


Share holder returns

PHIndustryMarket
7 Day5.1%3.2%1.0%
30 Day-1.4%-3.5%-1.8%
90 Day5.0%-4.6%-1.8%
1 Year12.1%9.9%4.5%2.3%9.1%6.7%
3 Year52.4%44.4%46.3%36.8%46.1%36.6%
5 Year85.5%68.2%60.6%41.3%66.9%48.6%

Price Volatility Vs. Market

How volatile is Parker-Hannifin's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Parker-Hannifin undervalued based on future cash flows and its price relative to the stock market?

18%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Undervalued: PH ($179.66) is trading below our estimate of fair value ($219.46)

Significantly Undervalued: PH is trading below fair value, but not by a significant amount.


Price Based on Earnings

PE vs Industry: PH is good value based on its PE Ratio (15.4x) compared to the Machinery industry average (19.7x).

PE vs Market: PH is good value based on its PE Ratio (15.4x) compared to the US market (17.5x).


Price Based on Expected Growth

Low PEG Ratio: PH is poor value based on its PEG Ratio (4.8x)


Price Based on Value of Assets

PB vs Industry: PH is overvalued based on its PB Ratio (3.9x) compared to the US Machinery industry average (2.2x).


Next Steps

Future Growth

How is Parker-Hannifin expected to perform in the next 1 to 3 years based on estimates from 18 analysts?

3.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: PH's forecast earnings growth (3.2% per year) is above the savings rate (2.7%).

Earnings vs Market: PH's earnings (3.2% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: PH's earnings are forecast to grow, but not significantly.

Revenue vs Market: PH's revenue (1.9% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: PH's revenue (1.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: PH's Return on Equity is forecast to be low in 3 years time (19.9%).


Next Steps

Past Performance

How has Parker-Hannifin performed over the past 5 years?

6.5%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: PH's earnings have grown by 6.5% per year over the past 5 years.

Accelerating Growth: PH's earnings growth over the past year (42.6%) exceeds its 5-year average (6.5% per year).

Earnings vs Industry: PH earnings growth over the past year (42.6%) exceeded the Machinery industry 18.7%.


Return on Equity

High ROE: Whilst PH's Return on Equity (25.35%) is high, this metric is skewed due to their high level of debt.


Return on Assets

ROA vs Industry: PH has a higher Return on Assets than the Machinery industry average last year.


Return on Capital Employed

ROCE Improving: PH has improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Parker-Hannifin's financial position?


Financial Position Analysis

Short Term Liabilities: PH's short term assets ($7.7B) exceeds its short term liabilities ($3.2B)

Long Term Liabilities: PH's short term assets (7.7B) do not cover its long term liabilities (8.5B)


Debt to Equity History and Analysis

Debt Level: PH's debt to equity ratio (119.1%) is considered high

Reducing Debt: PH's debt to equity ratio has increased from 34.9% to 119.1% over the past 5 years.

Debt Coverage: PH's debt is well covered by operating cash flow (24.3%).

Interest Coverage: PH's interest payments on its debt are well covered by EBIT (12.1x coverage).


Balance Sheet

Inventory Level: PH has a low level of unsold assets or inventory.

Debt Coverage by Assets: PH's debt is covered by short term assets (assets are 1.079520x debt).


Next Steps

Dividend

What is Parker-Hannifin's current dividend yield, its reliability and sustainability?

2.01%

Expected Dividend Yield


Dividend Yield vs Market

company2.0%marketbottom25%1.5%markettop25%3.8%industryaverage1.7%forecastin3Years2.0%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: PH's dividend (1.96%) is higher than the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: PH's dividend (1.96%) is low compared to the top 25% of dividend payers in the US market (3.77%).

Stable Dividend: PH's dividends per share have been stable in the past 10 years.

Growing Dividend: PH's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (27.2%), PH's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PH's dividends in 3 years are forecast to be well covered by earnings (29.2% payout ratio).


Next Steps

Management

What is the CEO of Parker-Hannifin's salary, the management and board of directors tenure and is there insider trading?

4.7yrs

Average management tenure


CEO

Thomas Williams (60yo)

4.7yrs

Tenure

US$17,472,500

Compensation

Mr. Thomas L. Williams, also known as Tom, has been Chief Executive Officer, President and Director of CLARCOR Inc. since February 28, 2017. Mr. Williams has been the Chief Executive Officer of Parker-Hann ...


CEO Compensation Analysis

Compensation vs. Market: Thomas's total compensation ($USD17.47M) is about average for companies of similar size in the US market ($USD11.20M).

Compensation vs Earnings: Thomas's compensation has been consistent with company performance over the past year.


Management Age and Tenure

4.7yrs

Average Tenure

56yo

Average Age

Experienced Management: PH's management team is considered experienced (4.7 years average tenure).


Board Age and Tenure

9.2yrs

Average Tenure

61.5yo

Average Age

Experienced Board: PH's board of directors are considered experienced (9.2 years average tenure).


Insider Trading

Insider Buying: PH insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

SellUS$123,86013 Sep 19
Thomas Gentile
EntityIndividual
Shares675
Max PriceUS$183.50
SellUS$412,54613 Sep 19
Mark Hart
EntityIndividual
Shares2,250
Max PriceUS$183.35
SellUS$151,63113 Sep 19
William Bowman
EntityIndividual
Shares830
Max PriceUS$182.69
SellUS$759,55813 Sep 19
Jennifer Parmentier
EntityIndividual
Role
Senior Key Executive
VP & President of Motion Systems Group
Shares4,154
Max PriceUS$182.88
SellUS$3,436,09812 Sep 19
Lee Banks
EntityIndividual
Role
Member of the Board of Directors
President
Shares18,989
Max PriceUS$180.95
SellUS$5,801,45411 Sep 19
Thomas Williams
EntityIndividual
Role
Chief Executive Officer
Chairman & CEO
Shares32,109
Max PriceUS$180.68
BuyUS$475,17427 Aug 19
Linda Harty
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares3,000
Max PriceUS$158.41
SellUS$52,67231 May 19
Robert Malone
EntityIndividual
Role
Senior Key Executive
VP & President of Filtration Group
Shares336
Max PriceUS$156.76
SellUS$798,68404 Mar 19
Andrew Weeks
EntityIndividual
Shares4,520
Max PriceUS$176.70
SellUS$225,34219 Feb 19
Robert Malone
EntityIndividual
Role
Senior Key Executive
VP & President of Filtration Group
Shares1,300
Max PriceUS$173.34
SellUS$150,34114 Feb 19
William Bowman
EntityIndividual
Shares875
Max PriceUS$171.82
SellUS$54,80614 Feb 19
Thomas Gentile
EntityIndividual
Shares319
Max PriceUS$171.81
SellUS$150,17808 Feb 19
Candy Obourn
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares926
Max PriceUS$162.18
BuyUS$20,82916 Jan 19
Robert Bohn
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares120
Max PriceUS$186.29

Ownership Breakdown


Management Team

  • Lee Banks (56yo)

    President

    • Tenure: 4.8yrs
    • Compensation: US$11.77m
  • M. Maxwell (61yo)

    VP and Chief Technology & Innovation Officer

    • Tenure: 0yrs
  • Thomas Williams (60yo)

    Chairman & CEO

    • Tenure: 4.7yrs
    • Compensation: US$17.47m
  • Rob Malone (56yo)

    VP & President of Filtration Group

    • Tenure: 4.8yrs
    • Compensation: US$4.07m
  • Cathy Suever (61yo)

    Executive VP of Finance & Administration and CFO

    • Tenure: 2.5yrs
    • Compensation: US$6.91m
  • Joe Leonti (47yo)

    VP, General Counsel & Secretary

    • Tenure: 5.3yrs
    • Compensation: US$2.90m
  • Robin Davenport

    Vice President of Corporate Finance

    • Tenure: 5yrs
  • Jenny Parmentier (52yo)

    VP & President of Motion Systems Group

    • Tenure: 0yrs
    • Compensation: US$3.77m
  • Michael O'Hara

    Vice President of Global Sales & Marketing

    • Tenure: 1.9yrs
  • Dinu Parel (39yo)

    VP & Chief Information Officer

    • Tenure: 0.9yrs

Board Members

  • Candy Obourn (68yo)

    Independent Director

    • Tenure: 17.8yrs
    • Compensation: US$296.30k
  • Bob Bohn (66yo)

    Independent Director

    • Tenure: 9.2yrs
    • Compensation: US$270.97k
  • Joe Scaminace (66yo)

    Independent Director

    • Tenure: 15yrs
    • Compensation: US$280.97k
  • Jim Wainscott (63yo)

    Lead Director

    • Tenure: 0yrs
    • Compensation: US$336.30k
  • Lindy Harty (58yo)

    Independent Director

    • Tenure: 12.8yrs
    • Compensation: US$297.30k
  • Lee Banks (56yo)

    President

    • Tenure: 4.8yrs
    • Compensation: US$11.77m
  • Åke Svensson (67yo)

    Independent Director

    • Tenure: 9.2yrs
    • Compensation: US$272.97k
  • Thomas Williams (60yo)

    Chairman & CEO

    • Tenure: 4.7yrs
    • Compensation: US$17.47m
  • James Verrier (56yo)

    Director

    • Tenure: 3.5yrs
    • Compensation: US$272.98k
  • Kevin Lobo (54yo)

    Independent Director

    • Tenure: 6.2yrs
    • Compensation: US$277.97k

Company Information

Parker-Hannifin Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Parker-Hannifin Corporation
  • Ticker: PH
  • Exchange: NYSE
  • Founded: 1918
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$23.086b
  • Shares outstanding: 128.50m
  • Website: https://www.parker.com

Number of Employees


Location

  • Parker-Hannifin Corporation
  • 6035 Parkland Boulevard
  • Cleveland
  • Ohio
  • 44124
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PHNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
PARDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
0KFZLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
PH *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968

Biography

Parker-Hannifin Corporation manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. It operates in two segments, Diversified Indu ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 01:22
End of Day Share Price2019/10/11 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.

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