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Parker Hannifin

PH

$963.34

+0.17%

Parker-Hannifin Corporation is a global motion-and-control technology manufacturer that engineers hydraulic, pneumatic, electromechanical, climate-control, and filtration components embedded inside larger systems such as aerospace engines, agricultural and construction machinery, freight and passenger vehicles, and industrial automation equipment. The company is a diversified industrial compounder rather than a single-product vendor: its roughly 59,850 employees sell thousands of small, mission-critical parts that are designed to work together, driving a high rate of cross-selling and sticky aftermarket relationships with OEMs. The current investor narrative centers on the aerospace supercycle and portfolio transformation — the pending acquisition of CIRCOR's commercial and defense aerospace business, announced in May 2026, is being framed as immediately accretive to growth, margins, and earnings, while the Diversified Industrial segment (roughly $7.5 billion in revenue versus $3.7 billion in Aerospace Systems) remains exposed to softer industrial and machinery demand. Debate among investors hinges on whether Parker's margin expansion — gross margin climbed to 39.0% in the June 2026 quarter from 37.3% a year earlier — is durable enough to justify a premium multiple, and whether aerospace M&A can offset cyclicality in the broader industrial book.…

Bobby Quantitative Model
Oct 16, 2026

PH

Parker Hannifin

$963.34

+0.17%
Oct 16, 2026
Bobby Quantitative Model
Parker-Hannifin Corporation is a global motion-and-control technology manufacturer that engineers hydraulic, pneumatic, electromechanical, climate-control, and filtration components embedded inside larger systems such as aerospace engines, agricultural and construction machinery, freight and passenger vehicles, and industrial automation equipment. The company is a diversified industrial compounder rather than a single-product vendor: its roughly 59,850 employees sell thousands of small, mission-critical parts that are designed to work together, driving a high rate of cross-selling and sticky aftermarket relationships with OEMs. The current investor narrative centers on the aerospace supercycle and portfolio transformation — the pending acquisition of CIRCOR's commercial and defense aerospace business, announced in May 2026, is being framed as immediately accretive to growth, margins, and earnings, while the Diversified Industrial segment (roughly $7.5 billion in revenue versus $3.7 billion in Aerospace Systems) remains exposed to softer industrial and machinery demand. Debate among investors hinges on whether Parker's margin expansion — gross margin climbed to 39.0% in the June 2026 quarter from 37.3% a year earlier — is durable enough to justify a premium multiple, and whether aerospace M&A can offset cyclicality in the broader industrial book.

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PH 12-Month Price Forecast

Historical Price
Current Price $963.34
Average Target $963.34
High Target $1107.84
Low Target $818.84

Wall Street consensus

Most Wall Street analysts maintain a constructive view on Parker Hannifin's 12-month outlook, with a consensus price target around $1155.62 and implied upside of +20.0% versus the current price.

Average Target

$1155.62

0 analysts

Implied Upside

+20.0%

vs. current price

Analyst Count

—

covering this stock

Price Range

$680 - $1358

Analyst target range

Coverage is deep and overwhelmingly constructive: 24 analysts follow Parker with a consensus recommendation of "buy" (mean rating 1.73 on a 1-to-5 scale where 1 is strong buy), and the average target price of $1,155.62 implies roughly +20.0% upside from the current $963.34. The consensus leans clearly bullish, and the recent institutional ratings flow reinforces it — Bernstein, Evercore ISI, KeyBanc, Susquehanna, Citigroup, UBS, BNP Paribas, Truist, and Wells Fargo have all reiterated Outperform/Buy/Overweight/Positive ratings between May and August 2026, with no downgrades in the visible record, suggesting analysts are anchoring on the CIRCOR deal and aerospace margin story rather than the softer 6-month price action.

The target range is unusually wide — $680 at the low to $1,358 at the high, a spread of $678, or roughly 70% of the current share price — which signals genuine disagreement about the durability of the cycle. The high target of $1,358 (about +41% upside) likely assumes multiple expansion on accelerating aerospace growth, full CIRCOR accretion, and margins pushing toward the mid-20s operating level; the low target of $680 (about -29% downside) appears to price in industrial recession, margin compression, and a de-rating toward the low-20s PE band seen in 2024. The wide dispersion, combined with a beta of 1.119 and a 19.5% max drawdown, argues for position sizing that respects the bear case even though the consensus and recent rating momentum both point higher.

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PH Technical Analysis

Parker is in a sustained, if choppy, uptrend: the stock is up 32.66% over the past year and trades at $963.34, which is approximately 87.7% of its 52-week range (low of $722.12, high of $1,099.94). That positioning — well above the midpoint but roughly 12.4% below the high — signals a stock with strong long-term momentum that has spent the last several months consolidating rather than pressing to new highs, leaving room for either a fresh breakout or a deeper mean-reversion pullback. The 52-week range itself is wide at roughly $378, or 52% of the low, reflecting a high-beta industrial name that has traveled a long way in twelve months.

Short-term momentum is re-accelerating after a mid-year stall: the stock is up 4.85% over the past month versus a 1.22% gain for SPY, a relative-strength spread of +3.63 points, while the 3-month change is only +1.06% and the 6-month change is -2.57%. That divergence — strong 1-month and 1-year performance against flat-to-negative 3- and 6-month returns — tells the story of a stock that peaked near $1,074 in early August 2026, corrected to the $918–$925 zone in mid-September, and has since recovered to the mid-$960s; the recent strength looks like a recovery leg within a consolidation rather than a new trend. Notably, relative strength versus SPY is negative over 3 months (-1.63), 6 months (-10.05), and YTD (-4.17), meaning the year-long outperformance (+17.13 points of relative strength over 12 months) has been eroding since spring, and the stock's max drawdown of -19.52% confirms meaningful intermediate volatility despite the bullish annual trend.

Key technical levels are well defined: resistance sits at the 52-week high of $1,099.94, with an intermediate ceiling near the August swing high around $1,074, while support rests at the September low near $918–$925 and, below that, the 52-week low of $722.12. A decisive break above $1,100 would confirm trend continuation and likely force momentum buyers back in, whereas a loss of the $918 shelf would target the $860–$880 congestion zone from May–June and put the annual uptrend in question. With a beta of 1.119, Parker is roughly 12% more volatile than the market — modest for an industrial but still requiring position sizing that accounts for drawdowns approaching 20%, and the thin volume reading of 636,028 shares suggests the current price action lacks conviction and should be confirmed by heavier participation before treating the recovery as durable.

Beta

1.12

1.12x market volatility

Max Drawdown

-19.5%

Largest decline past year

52-Week Range

$735-$1100

Price range past year

Annual Return

+32.7%

Cumulative gain past year

PeriodPH ReturnS&P 500
1m+4.9%+0.2%
3m+1.1%+2.9%
6m-2.6%+8.4%
1y+32.7%+14.9%
ytd+7.8%+11.9%

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PH Fundamental Analysis

Revenue is growing at a healthy clip and, importantly, accelerating: fiscal Q4 2026 (quarter ended June 30, 2026) revenue reached $5.755 billion, up 9.76% year over year, versus $5.486 billion in Q3 2026, $5.174 billion in Q2 2026, and $5.084 billion in Q1 2026 — a sequential climb across all four quarters of the fiscal year. The year-ago comparison quarter (Q4 2025) posted $5.243 billion, so the $512 million year-over-year increase marks a clear re-acceleration from the roughly 4–5% growth implied by earlier 2025 quarters. Segment disclosure shows Diversified Industrial at $7.527 billion and Aerospace Systems at $3.714 billion, meaning aerospace — the faster-growing, higher-margin business being expanded via the CIRCOR acquisition — is roughly a third of the revenue base and the key swing factor for the growth outlook; consensus FY revenue of $29.59 billion implies continued mid-to-high single-digit expansion.

Profitability is strong and expanding: Q4 2026 net income was $1.091 billion on a 18.96% net margin, with gross margin of 39.04% versus 37.34% in the year-ago quarter and 36.77% in Q3 2026 — a roughly 170-basis-point year-over-year improvement that points to pricing power and mix shift toward aerospace. Operating margin reached 23.86% in Q4 (operating income of $1.373 billion) versus 21.33% a year earlier, and the trailing operating margin of 21.55% with a 16.97% net margin places Parker comfortably in the upper tier of industrial machinery profitability. The quarterly progression — gross margin from 37.51% (Q1) to 37.32% (Q2) to 36.77% (Q3) to 39.04% (Q4) — shows a distinctly stronger finish to the fiscal year, which supports the bull case that margin expansion is structural rather than a one-off.

Balance sheet and cash generation are solid but not fortress-like: debt-to-equity is 0.55, the current ratio is 1.26, and interest coverage of roughly 14.5x on Q4 interest expense of $95 million is comfortable. Trailing free cash flow is $3.905 billion against a $123.5 billion market cap, a FCF yield of about 3.2%, and Q4 operating cash flow of $1.736 billion funded $173 million of capex, $936 million of dividends, $255 million of buybacks, and $1.058 billion of debt repayment — evidence the business self-funds growth and returns capital simultaneously. ROE of 23.69% and ROA of 9.79% are strong for the sector, though the low cash balance of $501 million and quick ratio near 0.74 mean liquidity is lean and the company relies on cash flow rather than a cash cushion; the 25.7% payout ratio leaves ample room to keep raising the modest 0.76% dividend.

Quarterly Revenue

$5.8B

2026-06

Revenue YoY Growth

+9.8%

YoY Comparison

Gross Margin

39.0%

Latest Quarter

Free Cash Flow

$3.9B

Last 12 Months

Revenue & Net Income Trends (2 Years)

Revenue Breakdown

Aerospace Systems Segment
Diversified Industrial Segment

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Valuation Analysis: Is PH Overvalued?

Because Parker is solidly profitable — Q4 2026 net income of $1.091 billion and positive trailing EPS — the PE ratio is the appropriate primary metric. The stock trades at 33.86x trailing earnings but only 24.26x forward earnings, a roughly 28% compression that implies the market expects meaningful EPS growth; consensus FY EPS of $49.91 against the current $963.34 price corroborates a forward multiple in the mid-20s, and the 6.80 PEG ratio warns that the growth embedded in that forward number is already being paid for handsomely.

Against its own sector, Parker screens expensive on most measures: a 5.75x price-to-sales ratio, 8.02x price-to-book, 6.02x EV/sales, and 22.29x EV/EBITDA are premium multiples for industrial machinery, where the sector typically trades in the mid-teens on EV/EBITDA and low-to-mid single digits on sales. The premium is partly earned — 23.7% ROE, 21.6% operating margins, and a 39% gross margin are well above the average machinery company — but the 6.80 PEG and 28.3x price-to-cash-flow suggest the market is capitalizing Parker more like a high-quality compounder than a cyclical industrial, leaving little valuation cushion if growth decelerates.

Historically, Parker's own multiple band has expanded dramatically: PE was roughly 17.7x in mid-2023 and 20.5x in mid-2024, versus 33.9x trailing today, while price-to-sales has climbed from about 9.8x in mid-2023 to 21.4x on the most recent quarterly historical-ratio reading (reflecting the sharp share-price appreciation against a lagged revenue base). The stock is therefore near the top of its multi-year valuation band, which means optimistic expectations — aerospace strength, CIRCOR accretion, and continued margin expansion — are already discounted; a re-rating toward the low-20s PE seen as recently as 2024 would imply substantial downside even with earnings growth intact.

PE

33.9x

Latest Quarter

vs. Historical

High-End

5-Year PE Range 18x~33x

vs. Industry Avg

N/A

Industry PE ~N/A*

EV/EBITDA

22.3x

Enterprise Value Multiple

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