Quality Investor

Parker-Hannifin Corporation

Rank #264Hypergrowth

PH · NYSE · Industrials

Parker-Hannifin Corporation (PH) — Rank #264 by gross profitability (GP/assets 0.26) · ROE 23.7% · Piotroski F-Score 7 / 9.

As-of 2026-09-15 · CIK 0000076334 · all metrics point-in-time as of the filing date.

About

Parker-Hannifin Corporation engages in the manufacture and sale of motion and control technologies and systems for aerospace and defense, in-plant and industrial equipment, transportation, off-highway, energy, and HVAC and refrigeration markets in North America, EMEA, Asia Pacific, and Latin America.

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It operates through two segments: Diversified Industrial and Aerospace Systems. The company offers various motion-control systems and components, such as active and passive vibration control, high purity sealing, coatings, high temperature sealing, cryogenic valves and fittings, HVAC/R controls and monitoring, elastomeric, fabric reinforced, metal, precision cut seals, hydrogen and natural gas filters, electric and hydraulic pumps and motors, industrial air, gas filtration, electric and hydraulic valves, miniature pumps and valves, electromagnetic interface shielding, pneumatic actuators, regulators and valves, electromechanical and hydraulic actuators, power take offs, electronics, drives and controllers, process filtration solutions, engine filtration solutions, rubber to substrate adhesives, fluid condition monitoring, sensors and diagnostics, fluid conveyance hose and tubing, structural adhesives, high pressure connectors, fittings, valves and regulators, thermal management, high purity fittings. The company also provides products for use in commercial and defense airframe and engine programs, such as avionics, electric and hydraulic braking systems, electric power, electromechanical actuators, engine exhaust systems and components, fire detection and suppression, flight control systems, fluid conveyance, fuel systems and components, fuel tank inserting systems, hydraulic pumps and motors, hydraulic valves and actuators, pneumatics, seals, sensors, and thermal management products. The company sells its products to original equipment manufacturers, distributors, direct-sales employees.

Parker-Hannifin Corporation was founded in 1917 and is headquartered in Cleveland, Ohio.

Industry
Specialty Industrial Machinery
Sector
Industrials
State
OH
Filer Category
Large accelerated filer
Fiscal Year End
June 30
Website
parker.com

Price History

PH+249.1% · +28.4% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/S is the primary valuation lens — earnings are reinvested, not available for P/E.

Market Cap

$115.98B

P/E (annual)

32.3

P/S (annual)

5.4

P/B

7.5

P/OCF (annual)

26.6

Shareholder Yield

6.3%

Employees

59,850

Industry

Specialty Industrial Machinery

Exchange

NYSE

Signal Flags

2 green1 yellow1 red
Revenue growth acceleratingGrowth rate increasing year over year
Operating leverage expandingOperating income growing faster than revenue
Disclosure regressionA previously-disclosed line item is no longer reported — worth checking the filing for why
Balance sheet deterioratingNet cash collapsed with receivables or inventory outpacing revenue

Quality Profile

Profitability

1/1 pass
GP / assets
0.26
Return on equity
23.7%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
1.00
Current ratio
1.26×
Net cash
-$7.68B

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
0.8%

Growth

2/2 pass
Revenue growth
78.7%
Piotroski F-Score
7 / 9
Share dilution
-5.5%

Terry Smith quality gate

Passes 3/5 Terry Smith thresholds

1 of 5 threshold not computable from filed data.

What Growth Is Priced In

Implied revenue growth (10Y)

13.3%

incredible deal

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Buyback tailwind: -5.5% — per-share value needs a total required return of 7.8% once share-count change is priced in.

vs. own 6-year median revenue growth: 1.5%

priced above its own history

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

8.7%

r = 10% (base)

13.3%

r = 12%

17.3%

Net debt / market cap: 6.5%

Note: current FCF margin is 2.3σ above its historical mean — implied growth may understate valuation risk if the margin reverts.

Base FCF: $3.9B3Y mean FCF: $1.2B

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

13.8xCheap
13.8xmed 17.7x21.9x

P / S

Price / revenue per share

1.5xFair
1.2xmed 1.4x1.8x

P / B

Price / book value per share

3.5xFair
2.6xmed 3.6x4.1x

P / GP

Price / gross profit per share

5.8xFair
4.9xmed 5.9x7.5x

P / FCF

Price / free cash flow per share

13.6xCheap
13.6xmed 15.8x19.4x

Revenue growth and the path to profitability (margin trend) are the primary reads at this stage.

Profitability

Gross profitability (GP / assets)

0.26

Primary signal (Novy-Marx).

3rd of 5 SIC 3490 peers

Return on equity

23.7%

Gross margin

37.7%

4th of 5 SIC 3490 peers

Revenue growth (YoY)

78.7%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2015201620172018
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

1.00

4th of 5 SIC 3490 peers (best = lowest)

Current ratio

1.26×

5th of 5 SIC 3490 peers

Quick ratio

0.60×

Net cash

-$7.68B

Cash & equivalents minus total debt.

Cash-flow health

Free cash flow

$3.90B

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

0.07

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

0.8%

Stock-based comp intensity.

Dividend safety

Composite score

4.0 / 5

Strong
Payout ratio
25.7%5/5 Strong
FCF coverage
4.17×5/5 Strong
Dividend growth streak
10 yr5/5 Strong
Balance-sheet health
D/E 1.00 · IC N/A1/5 Weak

Piotroski F-Score

F-Score

7 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20132018
Value
Decline
Capital Return