Parker Hannifin (PH) AI Stock Analysis

• Market Cap: $126.44B
• Dividend Yield: 0.79%
• Average Volume (3M): 682.50K
• Price to Earnings (P/E): 36.5
• Beta (1Y): 1.20
• Revenue Growth: 0.22%
• EPS Growth: 26.66%
• Country: US
• Employees: 61,120
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 7.65
• Shares Outstanding: 126,216,530
• 10 Day Avg. Volume: 729,193
• 30 Day Avg. Volume: 682,505
• PEG Ratio: 1.04
• Price to Book (P/B): 6.55
• Price to Sales (P/S): 4.51
• P/FCF Ratio: 26.82
• Enterprise Value/Market Cap: 1.08
• Enterprise Value/Revenue: 6.69
• Enterprise Value/Gross Profit: 17.96
• Enterprise Value/Ebitda: 24.95
• 1Y Price Target: $1,025.10
• Price Target Upside: 2.33% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 12
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 80 Outperform
• Price Target: $1,091.00 ▲(8.91% Upside)

Score is driven primarily by strong and improving fundamentals (higher profitability and better leverage) and a bullish technical trend (above major moving averages with positive MACD). The latest earnings call further supports the outlook with raised guidance and strong order/backlog momentum, while a high P/E and low dividend yield temper the rating.

Positive Factors

Strong Profitability & Margins

Sustained margin expansion and high ROE reflect durable operational improvements and pricing/efficiency advantages. Higher quality earnings reduce reliance on volume, support reinvestment and dividend policy, and provide buffer versus cyclical revenue dips over the next several quarters.

Robust Cash Generation

Consistent multi-billion dollar free cash flow gives Parker durable funding for capex, dividends, acquisitions and debt paydown. Guidance for >100% conversion and $3.2–$3.6B FCF underpins balance sheet flexibility and reduces execution risk on strategic investments.

Order Backlog & Aerospace Strength

A record backlog and outsized aerospace orders provide multi-quarter revenue visibility and support utilization, pricing leverage and margin sustainability. Strong aerospace aftermarket and OEM demand diversifies earnings away from softer industrial pockets.

Negative Factors

Stagnant Top-Line Growth

Very low organic revenue growth limits operating leverage and long-term EPS upside, forcing reliance on margin expansion and acquisitions. If margins compress or M&A slows, earnings growth could weaken given the tepid underlying sales trajectory.

Increased Leverage from Acquisition Financing

Large, deal-related borrowings materially increase near-term debt and covenant exposure. Higher absolute leverage reduces financial flexibility, raises interest sensitivity, and constrains capital allocation if industrial demand softens or integration takes longer than planned.

Cyclical End‑Market Exposure

Meaningful exposure to transportation, agriculture and upstream energy adds structural volatility to revenue and aftermarket cycles. Persistent weakness in these segments can pressure utilization and margins, limiting sustainable earnings growth during industry downturns.

Parker Hannifin Business Overview & Revenue Model

Company Description

Parker-Hannifin Corporation manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. The company operates through two segments, Diversified Industrial and Aerospace Systems. The Company's Diversified Industrial segment offers sealing, shielding, thermal products and systems, adhesives, coatings, and noise vibration and harshness solutions; filters, systems, and diagnostics solutions to monitor and remove contaminants from fuel, air, oil, water, and other liquids and gases; connectors, which control, transmit, and contain fluid; control solutions for extreme corrosion resistance, temperatures, pressures, and precise flow; and hydraulic, pneumatic, and electromechanical components and systems for builders and users of mobile and industrial machinery and equipment. This segment sells its products to original equipment manufacturers (OEMs) and distributors who serve the replacement markets in manufacturing, packaging, processing, transportation, construction, refrigeration and air conditioning, agricultural, and military machinery and equipment industries. Its Aerospace Systems segment offers products for use in commercial and military airframe and engine programs, such as control actuation systems and components, engine build-up ducting, engine exhaust nozzles and assemblies, engine systems and components, fluid conveyance systems and components, fuel systems and components, fuel tank inerting systems, hydraulic systems and components, lubrication components, pilot controls, pneumatic control components, thermal management products, and wheels and brakes, as well as fluid metering, delivery, and atomization devices. This segment markets its products directly to OEMs and end users. It markets its products through direct-sales employees, independent distributors, and sales representatives. The company was founded in 1917 and is headquartered in Cleveland, Ohio.

How the Company Makes Money

Parker Hannifin generates revenue primarily through the sale of its diverse range of motion and control products. The company’s revenue model is built on several key streams, including direct sales of manufactured products, maintenance and service contracts, and aftermarket support. Parker's extensive distribution network and partnerships with OEMs enhance its market reach, enabling robust sales across various sectors. Additionally, the company benefits from long-term contracts and relationships with large customers, which provide a stable revenue base. Furthermore, Parker invests in research and development to innovate and expand its product offerings, ensuring it meets evolving customer needs and maintains a competitive edge in the market.

Parker Hannifin Financial Statement Overview

Summary

Strong profitability and returns (net income up materially since 2022; net margin ~17–18%; ROE ~25%) with improved leverage (debt/equity down to ~0.64x TTM). Offsets include flat-to-low revenue growth (~0% in 2025; ~2% TTM) and mixed recent cash-flow momentum (TTM FCF slightly down, suggesting some cash conversion variability).

Income Statement

Profitability has strengthened meaningfully over the last several years, with net income rising from ~$1.3B (2022) to ~$3.5B in both 2025 annual and TTM (Trailing-Twelve-Months). Margins also expanded (net margin from ~8% in 2022 to ~17–18% in 2025), supporting a higher-quality earnings profile. The key weakness is growth: revenue is essentially flat in the latest annual period (2025 revenue growth ~0%) and only modestly positive in TTM (TTM revenue growth ~2%), suggesting a slower top-line trajectory despite strong execution on profitability.

Balance Sheet

Leverage has improved materially: debt relative to equity declined from ~1.30x (2022) and ~1.22x (2023) to ~0.69x (2025 annual) and ~0.64x (TTM), indicating a healthier capital structure. Equity has grown steadily (from ~$8.8B in 2022 to ~$15.3B in TTM), while returns remain strong (return on equity ~25% in 2025/TTM). The main watch item is that absolute debt remains sizable (~$9.9B in TTM), which can limit flexibility if industrial demand weakens or rates remain elevated.

Cash Flow

Cash generation is solid, with free cash flow near ~$3.3B in both 2025 annual and TTM (Trailing-Twelve-Months), and free cash flow tracking reasonably close to net income (about ~0.88–0.89x in 2025/TTM). However, recent momentum is mixed: TTM free cash flow growth is down (~-1.3%) and operating cash flow covers a relatively modest portion of revenue (about ~0.61–0.65 in 2025/TTM), signaling some working-capital or cash conversion variability versus the strength in reported earnings.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	20.46B	19.85B	19.93B	19.07B	15.86B	14.35B
Gross Profit	7.63B	7.32B	7.16B	6.46B	4.39B	3.90B
EBITDA	5.49B	5.42B	5.03B	4.07B	2.44B	3.09B
Net Income	3.54B	3.53B	2.84B	2.08B	1.32B	1.75B
Balance Sheet
Total Assets	30.51B	29.49B	29.30B	29.96B	25.94B	20.34B
Cash, Cash Equivalents and Short-Term Investments	427.00M	467.00M	422.03M	483.57M	6.68B	772.23M
Total Debt	9.87B	9.64B	10.97B	12.98B	11.72B	6.81B
Total Liabilities	16.19B	15.80B	17.22B	19.63B	17.08B	11.93B
Stockholders Equity	14.31B	13.68B	12.07B	10.33B	8.85B	8.40B
Cash Flow
Free Cash Flow	3.34B	3.34B	2.98B	2.60B	2.21B	2.37B
Operating Cash Flow	3.74B	3.78B	3.38B	2.98B	2.44B	2.58B
Investing Cash Flow	-1.33B	224.00M	-298.59M	-8.18B	-418.84M	-13.00K
Financing Cash Flow	-2.40B	-3.98B	-3.11B	-971.04M	3.92B	-2.62B

Parker Hannifin Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1001.75
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PH, the sentiment is Positive. The current price of 1001.75 is above the 20-day moving average (MA) of 955.00, above the 50-day MA of 917.48, and above the 200-day MA of 775.20, indicating a bullish trend. The MACD of 22.88 indicates Negative momentum. The RSI at 69.79 is Neutral, neither overbought nor oversold. The STOCH value of 75.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PH.

Parker Hannifin Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PH	80 Outperform	$126.44B	36.54	25.79%	0.79%	0.22%	26.66%
ETN	79 Outperform	$151.18B	37.25	21.57%	1.29%	8.24%	6.21%
ITW	72 Outperform	$86.91B	28.56	93.75%	2.43%	-0.41%	-10.88%
ROP	70 Outperform	$34.60B	22.64	7.93%	0.73%	13.95%	6.80%
EMR	69 Neutral	$83.29B	36.18	11.31%	1.58%	2.97%	18.14%
ROK	68 Neutral	$44.31B	45.12	27.71%	1.33%	0.98%	-7.51%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Parker Hannifin Corporate Events

Parker Hannifin Secures Loans for Filtration Group Acquisition

On December 10, 2025, Parker Hannifin Corporation entered into two significant credit agreements to secure financing for its proposed acquisition of Filtration Group Corporation. The agreements include a 364-Day Term Loan Agreement for $5.25 billion and a Three-Year Term Loan Agreement for $2.50 billion, both aimed at providing the necessary funds for the acquisition. These credit facilities are structured as senior unsecured delayed draw term loans, with specific covenants and conditions typical for such financial arrangements. The move is expected to impact the company’s operations by enabling the acquisition, potentially enhancing its market position in the filtration industry.

The most recent analyst rating on (PH) stock is a Buy with a $1006.00 price target. To see the full list of analyst forecasts on Parker Hannifin stock, see the PH Stock Forecast page.

Parker Hannifin Announces $9.25B Acquisition of Filtration Group

On November 10, 2025, Parker Hannifin Corporation announced its agreement to acquire Filtration Group Corporation for $9.25 billion through a merger. This strategic acquisition is expected to enhance Parker’s filtration technology offerings, with the transaction being financed by new debt and cash on hand. The merger’s completion is contingent upon regulatory approvals and other customary conditions, with a deadline set for February 10, 2027.

The most recent analyst rating on (PH) stock is a Buy with a $906.00 price target. To see the full list of analyst forecasts on Parker Hannifin stock, see the PH Stock Forecast page.