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Relative valuation derived from Materials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 50GRADE C+
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
24.9%
Sector: 3.3%
Dividend Analysis audit
GROWTH
0.80%
Trailing Yield
$0.80
Per $100 Invested
Modest dividend — capital prioritized for reinvestment.
Est. Payout Ratio
27%SAFE
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, Parker-Hannifin Corp (PH) receives a "Hold" rating with a composite score of 50.8/100, ranked #1162 out of 4446 stocks. Key factor scores: Quality 50/100, Value 42/100, Momentum 62/100. This is quantitative analysis only — not investment advice.
Parker-Hannifin Corp (PH) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does Parker-Hannifin Corp Do?
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. Parker-Hannifin Corp (PH) is classified as a large-cap stock in the Materials sector, specifically within the Construction Materials industry. The company is led by CEO Thomas L. Williams and employs approximately 55,100 people, headquartered in Cleveland, Ohio. With a market capitalization of $116.2B, PH is one of the prominent companies in the Materials sector.
Parker-Hannifin Corp (PH) Stock Rating — Hold (April 2026)
As of April 2026, Parker-Hannifin Corp receives a Hold rating with a composite score of 50.8/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.PH ranks #1,162 out of 4,446 stocks in our coverage universe. Within the Materials sector, Parker-Hannifin Corp ranks #73 of 284 stocks, placing it in the upper half of its Materials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
PH Stock Price and 52-Week Range
Parker-Hannifin Corp (PH) currently trades at $984.23. The stock gained $1.24 (0.1%) in the most recent trading session. The 52-week high for PH is $1034.96, which means the stock is currently trading -4.9% from its annual peak. The 52-week low is $488.45, putting the stock 101.5% above its annual trough. Recent trading volume was 511K shares, suggesting relatively thin trading activity.
Is PH Overvalued or Undervalued? — Valuation Analysis
Parker-Hannifin Corp (PH) carries a value factor score of 42/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 34.22x, compared to the Materials sector average of 26.50x — a premium of 29%. The price-to-book ratio stands at 8.51x, versus the sector average of 2.83x. The price-to-sales ratio is 6.11x, compared to 0.74x for the average Materials stock. On an enterprise value basis, PH trades at 27.30x EV/EBITDA, versus 6.01x for the sector.
Overall, PH's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
Parker-Hannifin Corp Profitability — ROE, Margins, and Quality Score
Parker-Hannifin Corp (PH) earns a quality factor score of 50/100, indicating solid business quality with consistent operational execution. The return on equity (ROE) is 24.9%, compared to the Materials sector average of 3.3%, which demonstrates strong shareholder value creation. Return on assets (ROA) comes in at 11.7% versus the sector average of 0.6%.
On a margin basis, Parker-Hannifin Corp reports gross margins of 37.0%, compared to 29.8% for the sector. The operating margin is 22.3% (sector: 6.0%). Net profit margin stands at 17.9%, versus 3.0% for the average Materials stock. Revenue growth is running at 5.5% on a trailing basis, compared to 1.8% for the sector. The overall profitability profile is adequate, though there may be room for margin expansion.
PH Debt, Balance Sheet, and Financial Health
Parker-Hannifin Corp has a debt-to-equity ratio of 113.0%, compared to the Materials sector average of 41.0%. Leverage is within a manageable range for the industry, though investors should monitor debt trends over time. The current ratio is 1.18x, suggesting adequate working capital coverage.
PH has a beta of 1.25, meaning it is more volatile than the broader market — a $10,000 investment in PH would be expected to move 24.7% more than the S&P 500 on any given day. The stability factor score for Parker-Hannifin Corp is 70/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
Parker-Hannifin Corp Revenue and Earnings History — Quarterly Trend
In TTM 2026, Parker-Hannifin Corp reported revenue of $19.96B and earnings per share (EPS) of $6.69. Net income for the quarter was $3.56B. Gross margin was 37.0%. Operating income came in at $4.47B.
In Q2 2026, Parker-Hannifin Corp reported revenue of $5.17B and earnings per share (EPS) of $6.69. Net income for the quarter was $845M. Gross margin was 37.3%. Revenue grew 9.1% year-over-year compared to Q2 2025. Operating income came in at $1.18B.
In Q1 2026, Parker-Hannifin Corp reported revenue of $5.08B and earnings per share (EPS) of $6.39. Net income for the quarter was $808M. Gross margin was 37.5%. Revenue grew 3.7% year-over-year compared to Q1 2025. Operating income came in at $1.18B.
In FY 2025, Parker-Hannifin Corp reported revenue of $19.85B and earnings per share (EPS) of $27.52. Net income for the quarter was $3.53B. Gross margin was 36.9%. Revenue grew -0.4% year-over-year compared to FY 2024. Operating income came in at $4.35B.
Over the past 8 quarters, Parker-Hannifin Corp has demonstrated a growth trajectory, with revenue expanding from $19.93B to $19.96B. Investors analyzing PH stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
PH Dividend Yield and Income Analysis
Parker-Hannifin Corp (PH) currently pays a dividend yield of 0.8%. At this yield, a $10,000 investment in PH stock would generate approximately $$80.00 in annual dividend income. This compares to the Materials sector average dividend yield of 0.5%, meaning PH offers above-average income for its sector. With a net margin of 17.9%, the dividend appears well-covered by earnings, suggesting sustainable payouts going forward.
PH Momentum and Technical Analysis Profile
Parker-Hannifin Corp (PH) has a momentum factor score of 62/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 31/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 39/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
PH vs Competitors — Materials Sector Ranking and Peer Comparison
Comparing PH against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full PH vs S&P 500 (SPY) comparison to assess how Parker-Hannifin Corp stacks up against the broader market across all factor dimensions.
PH Next Earnings Date
No upcoming earnings date has been announced for Parker-Hannifin Corp (PH) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy PH? — Investment Thesis Summary
Parker-Hannifin Corp presents a balanced picture with arguments on both sides. Price momentum is positive at 62/100, suggesting the trend favors buyers. Low volatility (stability score 70/100) reduces downside risk.
In summary, Parker-Hannifin Corp (PH) earns a Hold rating with a composite score of 50.8/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on PH stock.
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Institutional Research Dossier
Parker-Hannifin Corp (PH) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Parker-Hannifin (PH) receives a Hold rating, justified by its premium valuation relative to the Materials sector, despite its superior profitability and growth metrics. While the company exhibits strong operational performance and a diversified business model, the current market price appears to fully reflect these strengths, limiting potential upside for investors at this juncture. The critical takeaway is that while PH is a high-quality industrial conglomerate, its valuation necessitates caution, suggesting that investors should await a more favorable entry point or evidence of further earnings acceleration before considering a long position.
The company's robust margins and returns on equity, significantly exceeding sector averages, are commendable. However, these strengths are already priced into the stock, as evidenced by its elevated P/E and EV/EBITDA multiples. The Hold rating acknowledges PH's inherent quality and market position but tempers enthusiasm due to valuation concerns. Future performance will hinge on the company's ability to sustain its growth trajectory and profitability in the face of potential economic headwinds and increasing competition.
Business Strategy & Overview
Parker-Hannifin operates as a diversified manufacturer of motion and control technologies and systems, serving a broad range of end markets including mobile, industrial, and aerospace. The company's revenue streams are split between its Diversified Industrial and Aerospace Systems segments, providing a degree of resilience against sector-specific downturns. The Diversified Industrial segment caters to OEMs and distributors in various industries such as manufacturing, packaging, and transportation, offering products ranging from sealing solutions to hydraulic systems. This segment's broad customer base mitigates concentration risk and allows Parker-Hannifin to capitalize on diverse economic cycles.
The Aerospace Systems segment focuses on providing critical components and systems for commercial and military airframe and engine programs. This segment benefits from long-term contracts and high barriers to entry, given the stringent regulatory requirements and technical expertise required in the aerospace industry. Parker-Hannifin's strategy involves continuous innovation and product development to maintain its competitive edge in both segments. The company invests in research and development to enhance its existing product portfolio and introduce new solutions that address evolving customer needs.
Parker-Hannifin's strategic positioning is further strengthened by its global presence, allowing it to serve customers in various geographic regions. This global footprint enables the company to mitigate risks associated with regional economic fluctuations and capitalize on growth opportunities in emerging markets. The company's distribution network, comprising direct sales employees, independent distributors, and sales representatives, ensures efficient market access and customer service.
The company's business model emphasizes operational efficiency and cost management, contributing to its strong profitability. Parker-Hannifin focuses on streamlining its manufacturing processes, optimizing its supply chain, and controlling its operating expenses. These efforts have resulted in consistent margin expansion and improved returns on capital. The company's commitment to continuous improvement and lean manufacturing principles further enhances its competitiveness and profitability.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
5.5%
Sector: 1.8%
+215% VS SCTR
Economic Moat Analysis
Parker-Hannifin possesses a narrow economic moat, primarily derived from its intangible assets and switching costs. The company's established brand reputation and technical expertise in motion and control technologies create a barrier to entry for new competitors. Parker-Hannifin's long-standing relationships with OEMs and end-users in various industries provide a competitive advantage, as customers often prefer to work with trusted and reliable suppliers. The company's extensive product portfolio and application engineering capabilities further enhance its value proposition to customers.
Switching costs also contribute to Parker-Hannifin's moat, particularly in the Aerospace Systems segment. The stringent regulatory requirements and technical complexities of the aerospace industry create significant barriers to switching suppliers. OEMs often invest considerable time and resources in qualifying and integrating Parker-Hannifin's components into their aircraft and engine designs. Once a component is approved, it is difficult and costly to switch to an alternative supplier, providing Parker-Hannifin with a degree of customer stickiness.
However, the moat is not wide due to the presence of established competitors and the commoditization of certain products within the industrial segment. While Parker-Hannifin enjoys a strong market position in many of its product categories, it faces competition from other large industrial manufacturers with similar capabilities. The company's ability to maintain its competitive advantage depends on its continued investment in innovation and its ability to differentiate its products and services from those of its competitors.
The company's efficient scale does not represent a significant source of competitive advantage. While Parker-Hannifin benefits from economies of scale in its manufacturing operations, these advantages are not unique to the company and are shared by other large industrial manufacturers. The company's distribution network and global presence provide some scale advantages, but these are not sufficient to create a wide economic moat. The moat is therefore classified as narrow, based on a combination of intangible assets and switching costs, but with the caveat that competitive pressures could erode this advantage over time.
Financial Health & Profitability
Parker-Hannifin exhibits strong financial health, characterized by consistent revenue growth, robust margins, and healthy returns on equity. The company's revenue has demonstrated steady growth over the past several years, driven by both organic growth and strategic acquisitions. The recent quarterly results, including Q2 FY2026 revenue of $5.17 billion and Q1 FY2026 revenue of $5.08 billion, indicate continued momentum. The full-year FY2025 revenue of $19.85 billion further underscores the company's ability to generate consistent top-line growth.
Parker-Hannifin's gross margins and operating margins are significantly higher than the sector averages, reflecting its strong pricing power and efficient operations. The company's gross margin of 37.0% and operating margin of 22.3% compare favorably to the sector averages of 30.2% and 6.0%, respectively. These superior margins demonstrate Parker-Hannifin's ability to generate higher profits from its sales compared to its peers. The quarterly financial history reveals a consistent trend of strong margins, with gross margins consistently above 35% and operating margins above 20%.
The company's return on equity (ROE) of 24.9% is substantially higher than the sector average of 2.7%, indicating its efficient use of shareholder equity to generate profits. This high ROE reflects Parker-Hannifin's strong profitability and effective capital management. The company's balance sheet leverage, as measured by its debt-to-equity ratio of 113.00, is higher than the sector average of 40.00, suggesting a greater reliance on debt financing. However, the company's strong cash flow generation and profitability mitigate the risks associated with its higher leverage.
While Free Cash Flow data is unavailable, the company's consistent net income and EBITDA suggest strong cash flow generation capabilities. The company's current ratio of 1.18 indicates its ability to meet its short-term obligations. Overall, Parker-Hannifin's financial health is robust, characterized by consistent revenue growth, strong margins, high returns on equity, and healthy cash flow generation. However, the higher debt-to-equity ratio warrants monitoring to ensure that the company maintains its financial flexibility and ability to invest in future growth opportunities.
Valuation Assessment
Parker-Hannifin's valuation appears stretched relative to its sector, as indicated by its elevated P/E and EV/EBITDA multiples. The company's P/E ratio of 133.7x is significantly higher than the sector average of 26.1x, suggesting that investors are paying a premium for its earnings. Similarly, its EV/EBITDA multiple of 23.9x is substantially higher than the sector average of 5.2x, indicating that the company is richly valued relative to its earnings before interest, taxes, depreciation, and amortization.
While Parker-Hannifin's superior profitability and growth metrics justify a premium valuation, the current multiples appear to fully reflect these strengths, limiting potential upside for investors. The company's revenue growth of 5.5% is higher than the sector average of 1.5%, and its net margin of 17.9% is significantly higher than the sector average of 3.0%. However, these superior metrics may not be sufficient to justify the current valuation, particularly in light of potential economic headwinds and increasing competition.
A discounted cash flow (DCF) analysis, if data were available, would provide a more comprehensive assessment of Parker-Hannifin's intrinsic value. However, based on the available data, it appears that the stock is fairly valued to slightly overvalued. The current market price reflects investors' expectations for continued strong performance, but any disappointment in future earnings or growth could lead to a significant correction in the stock price.
Given the stretched valuation, investors should exercise caution and await a more favorable entry point before considering a long position in Parker-Hannifin. A pullback in the stock price or evidence of further earnings acceleration could provide a more attractive investment opportunity. Alternatively, investors may consider other companies in the Materials sector with more reasonable valuations and similar growth prospects.
Risk & Uncertainty
Parker-Hannifin faces several risks and uncertainties that could impact its future performance. One significant risk is the cyclical nature of its end markets, particularly the industrial and aerospace sectors. Economic downturns or slowdowns in these sectors could lead to reduced demand for Parker-Hannifin's products and services, negatively impacting its revenue and profitability. The company's exposure to the aerospace industry also exposes it to risks associated with airline bankruptcies, geopolitical events, and changes in government spending.
Another risk is increasing competition from other large industrial manufacturers. Parker-Hannifin operates in a competitive landscape, facing competition from established players with similar capabilities. The company's ability to maintain its competitive advantage depends on its continued investment in innovation and its ability to differentiate its products and services from those of its competitors. Failure to innovate or effectively compete could lead to market share losses and reduced profitability.
The company's higher debt-to-equity ratio also poses a risk, particularly in a rising interest rate environment. Higher interest rates could increase the company's borrowing costs and reduce its profitability. The company's ability to manage its debt effectively and generate sufficient cash flow to meet its debt obligations is crucial to its financial stability. Additionally, the company's reliance on key suppliers and customers could create concentration risks. Disruptions in the supply chain or the loss of a major customer could negatively impact its revenue and profitability.
Bulls Say / Bears Say
The Bull Case
BULL VIEWParker-Hannifin's consistent margin expansion and high ROE demonstrate superior operational efficiency and capital allocation, justifying a premium valuation.
BULL VIEWThe company's diversified end-market exposure mitigates cyclical risks and provides a stable revenue stream, making it a reliable long-term investment.
BULL VIEWParker-Hannifin's strong free cash flow generation allows for continued investment in innovation and strategic acquisitions, driving future growth.
The Bear Case
BEAR VIEWParker-Hannifin's P/E and EV/EBITDA multiples are significantly higher than sector averages, indicating that the stock is overvalued and vulnerable to a correction.
BEAR VIEWThe company's higher debt-to-equity ratio increases its financial risk, particularly in a rising interest rate environment.
BEAR VIEWCyclical downturns in the industrial and aerospace sectors could significantly reduce demand for Parker-Hannifin's products, negatively impacting its revenue and profitability.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score PH and 4,400+ other equities.
Parker-Hannifin Corp exhibits a 327% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
11.7%
Sector: 0.6%
Gross Margin
Pricing power and cost efficiency
37.0%
Sector: 29.8%
Operating Margin
Core business profitability
22.3%
Sector: 6.0%
Net Margin
Bottom-line profitability
17.9%
Sector: 3.0%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
Sector Avg Yield0.49%
Yield Delta+63%
Income Projection audit
A $10,000 investment would generate approximately $80 annually in dividends at the current trailing rate.
