Parker Corporation (9845) AI Stock Analysis

• Market Cap: ¥39.75B
• Dividend Yield: 1.78%
• Average Volume (3M): 21.57K
• Price to Earnings (P/E): 10.1
• Beta (1Y): 0.83
• Revenue Growth: -0.94%
• EPS Growth: 51.59%
• Country: JP
• Employees: 2,217
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 48.27
• Shares Outstanding: 26,801,453
• 10 Day Avg. Volume: 25,280
• 30 Day Avg. Volume: 21,566
• PEG Ratio: -0.32
• Price to Book (P/B): 0.44
• Price to Sales (P/S): 0.29
• P/FCF Ratio: 5.11
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: ¥1,821.00 ▲(14.60% Upside)

Parker Corporation's strong financial performance and undervalued valuation are the primary drivers of its stock score. The company demonstrates robust financial health with consistent revenue growth and solid profitability margins. The technical analysis indicates strong bullish momentum, though caution is advised due to overbought signals. The attractive P/E ratio and dividend yield further enhance the stock's appeal. However, the absence of earnings call insights and corporate events limits additional context.

Positive Factors

Balance Sheet Strength

Very low leverage and a high equity ratio give the company durable financial flexibility. This supports capital spending, M&A optionality, and resilience through industrial cycles, reducing refinancing risk and preserving operational continuity over months to years.

Cash Generation

Strong cash conversion indicates underlying earnings quality and reliable internal funding for capex, R&D, and dividends. Consistent cash generation sustains strategic investments and cushions against cyclical revenue swings over the medium term.

Diversified B2B Model

Wide industry exposure and multiple revenue streams (products, aftermarket services, bespoke engineering) reduce dependency on any single end market. This structural diversification supports steadier revenue and long-term customer relationships across economic cycles.

Negative Factors

Return on Equity

A moderate ROE suggests limited effectiveness in turning shareholder capital into profits relative to stronger peers. Over time, subpar ROE can constrain shareholder returns and signal the need for better capital allocation or margin improvement initiatives.

Free Cash Flow Trend

A falling free cash flow, even modestly, reduces available funds for reinvestment, dividends, or debt reduction. If this trend persists it could limit strategic flexibility and pressure funding for R&D or aftermarket expansion over the next several quarters.

Declining Net Income

A drop in net income despite operational scale points to margin pressures or rising costs. Sustained earnings deterioration would erode profitability resilience, hinder reinvestment capacity, and weaken ability to improve shareholder returns over the medium term.

Parker Corporation Business Overview & Revenue Model

Company Description

Parker Corporation provides product development, manufacturing, sales, and technical services for the automobiles, electrical machinery, chemicals, steel, electronics, food, etc. industries in Japan and internationally. The company imports and sells machinery and equipment for use in automobile, food, shoemaking, and chemical industries. It also develops, manufactures, and sells fine chemicals for industrial use, such as cleaning agents, rust prevention, etc.; and chemical products centered on advanced chemicals, such as electronics and printing, as well as special chemicals for the aftermarket of car, railways, and aircraft. In addition, the company develops and sells industrial sealing materials and adhesives; and manufactures and sells soundproofing materials for automobile and air conditioners. Further, it develops, designs, manufactures, and sells industrial machinery. The company was formerly known as Parker Shoji Co., Ltd. and changed its name to Parker Corporation in August 1988. Parker Corporation was founded in 1951 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Parker Corporation generates revenue through multiple streams, primarily by selling its wide range of products to various industries. The company operates on a B2B model, supplying its products to original equipment manufacturers (OEMs) and end-users. Key revenue streams include direct sales of hydraulic and pneumatic components, maintenance and repair services, and customized engineering solutions. Additionally, Parker Corporation benefits from strategic partnerships with other industry leaders, which help to expand its market reach and enhance product offerings. The company also invests in research and development to innovate new technologies, ensuring a continuous flow of revenue through advanced product lines that meet evolving customer needs.

Parker Corporation Financial Statement Overview

Summary

Parker Corporation exhibits strong financial health with consistent revenue growth and solid profitability margins. The balance sheet is robust, characterized by low leverage and a strong equity position. Cash flow management is effective, although there is a slight decline in free cash flow. The company is well-positioned financially, but should focus on improving net income and maintaining cash flow growth to sustain its positive trajectory.

Income Statement

Parker Corporation has demonstrated strong revenue growth with a 3.37% increase from the previous year, and a consistent upward trend over the past few years. The gross profit margin stands at 25.67%, and the net profit margin is 4.02%, indicating solid profitability. EBIT and EBITDA margins are 7.01% and 8.29% respectively, reflecting efficient operational management. However, the decline in net income from the previous year suggests some challenges in maintaining net profitability.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.12, indicating low leverage and financial stability. Return on Equity (ROE) is 6.18%, which is moderate, suggesting room for improvement in generating returns for shareholders. The equity ratio is 64.22%, highlighting a strong equity base relative to total assets. Overall, the balance sheet reflects a stable financial position with manageable debt levels.

Cash Flow

Parker Corporation shows a robust operating cash flow to net income ratio of 2.03, indicating strong cash generation relative to earnings. However, free cash flow decreased slightly by 0.89% from the previous year, which could be a concern if it continues. The free cash flow to net income ratio is 1.39, showing effective cash management. Despite minor fluctuations, the cash flow statement reflects overall healthy cash management practices.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	70.44B	70.01B	67.73B	56.79B	49.98B	44.06B
Gross Profit	18.51B	17.98B	16.35B	13.40B	11.87B	11.07B
EBITDA	6.06B	5.81B	7.30B	5.50B	4.69B	5.18B
Net Income	3.32B	2.81B	3.60B	2.48B	1.52B	2.38B
Balance Sheet
Total Assets	69.41B	70.85B	69.39B	60.16B	54.30B	53.24B
Cash, Cash Equivalents and Short-Term Investments	21.20B	21.90B	18.94B	18.02B	14.77B	14.25B
Total Debt	5.48B	5.31B	5.75B	5.53B	5.15B	4.94B
Total Liabilities	21.05B	22.37B	25.07B	21.12B	18.77B	18.56B
Stockholders Equity	45.44B	45.51B	41.56B	36.65B	33.39B	31.97B
Cash Flow
Free Cash Flow	0.00	3.92B	3.95B	3.06B	988.00M	3.35B
Operating Cash Flow	0.00	5.71B	5.33B	4.17B	2.10B	4.32B
Investing Cash Flow	0.00	-1.38B	-3.90B	-2.51B	-1.46B	-1.81B
Financing Cash Flow	0.00	-1.45B	-1.70B	-482.00M	-1.69B	-574.00M

Parker Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1589.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9845, the sentiment is Positive. The current price of 1589 is below the 20-day moving average (MA) of 1599.05, above the 50-day MA of 1486.28, and above the 200-day MA of 1088.96, indicating a neutral trend. The MACD of 17.27 indicates Positive momentum. The RSI at 56.84 is Neutral, neither overbought nor oversold. The STOCH value of 44.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9845.

Parker Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9845	79 Outperform	¥39.75B	10.10	―	1.78%	-0.94%	51.59%
7417	77 Outperform	¥19.55B	9.99	―	3.81%	-4.72%	-10.50%
8103	75 Outperform	¥38.38B	11.13	―	4.05%	-3.82%	18.03%
7628	66 Neutral	¥30.68B	14.21	―	2.98%	-2.82%	48.74%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
8089	63 Neutral	¥23.29B	6.76	―	3.55%	12.31%	90.88%
7624	59 Neutral	¥7.78B	23.91	―	2.78%	1.08%	82.69%