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Parker Hannifin Corp PH

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Morningstar’s Analysis

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Economic Moat


Capital Allocation


Solid Outperformance Prompts Us To Raise Parker’s Fair Value Estimate by Roughly 6%

Joshua Aguilar Equity Analyst

Analyst Note

| Joshua Aguilar |

Narrow moat rated Parker Hannifin had a very solid fiscal third quarter outing. On the heels of its outperformance, management raised both its top- and bottom-line guidance. Current full-year top-line guidance now stands at 4.5% year over year growth at the midpoint (implying a flat year over year organic sales guide), while adjusted EPS sits at $14.80 at the midpoint. Given Parker’s well-documented history of conservative guides and typical seasonality, we raise our own projections to 4.7% year over year in the firm’s reported top-line, and to $14.93 on an adjusted EPS basis. The latter figure sits just under the upper-bound range of management’s guidance for adjusted EPS.

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Company Profile

Business Description

Parker Hannifin is an industrial conglomerate operating two segments: diversified industrial, which serves a variety of end markets, and aerospace systems, which sells engine and actuation components. The diversified industrial segment consists of six groups, including engineered materials (sealing devices), filtration (filters and systems monitoring and removing contaminants from liquids and gases), fluid connectors (valves, couplings, and other fittings), instrumentation (flow manufacturing components and fluid control applications), and motion systems (hydraulic, pneumatic, and electromechanical components in industrial machinery and equipment). The segment boasts 15,500 independent distributors, and about 40% of its business occurs outside the United States.

6035 Parkland Boulevard
Cleveland, OH, 44124-4141
T +1 216 896-3000
Sector Industrials
Industry Specialty Industrial Machinery
Most Recent Earnings Mar 31, 2021
Fiscal Year End Jun 30, 2021
Stock Type Cyclical
Employees 50,520