PH
Parker-Hannifin Corporation$982.42
Sell
Target $790.03
Report: Mar 08, 2026Industrials • Industrial - Machinery • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$982.42-19.6%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$790.03
(20% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$1,034.96
52 Week Low$488.45
Avg. 3 Month Volume741K
Efficiency
LTM Gross Margin37.3%
LTM EBITDA Margin26.8%
LTM EBIT Margin22.3%
LTM Operating Margin21.0%
LTM ROA11.8%
LTM ROE25.6%
LTM ROIC31.1%
LTM ROCE19.4%
Capital Structure
Market Cap (MM)$113.0B
Enterprise Value (MM)$122.4B
Shares Outstanding126.22M
Total Debt (MM)$9.87B
Cash & Equivalents (MM)$427.00M
LTM Net Debt (MM)$9.44B
LTM Net Debt/EBITDA1.7x
Growth
TTM Rev. Growth2.8%
Last 3-Yr Rev. CAGR6.0%
Last 3-Yr EBITDA CAGR27.7%
Last 3-Yr EPS CAGR41.5%
Valuation
Street Target Price$1,015.75
LTM EV/Revenue6.0x
LTM EV/Gross Profit16.1x
LTM EV/EBIT26.8x
LTM EV/EBITDA22.3x
LTM P/E31.9x
LTM EV/FCF36.1x
LTM P/FCF33.3x
LTM P/TB9.6x
LTM P/B7.9x
Dividend Yield0.8%
Payout Ratio25.3%
Executive SummarySituation: Current price is $982.42 versus fair value $790.03 (-19.6% expected return), and valuation confidence is stable. Debate: Bull case depends on Normalization of Aerospace Aftermarket Growth As the post-pandemic surge in air travel stabilizes, the double-digit growth in aerospace spares and repairs is likely to revert to historical mid-single-digit levels, removing the primary en... Bear case centers on Cyclical Peak in Industrial Demand A broader slowdown in global manufacturing could lead to a sustained decline in Diversified Industrial volumes, which are already showing signs of stagnation with a 0.4% revenue decline in FY2025. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
The bull case rests on the continued outperformance of the Aerospace segment, which saw 11% organic growth in the most recent quarter, and the successful integration of the Filtration Group to drive $220M in synergies. Proponents argue that the shift to a higher-margin, less cyclical portfolio justifies a permanent upward re-rating of the multiple.
Bear Case
The bear case highlights the 0.4% decline in FY2025 revenue and the fact that EPS guidance has been missed in 4 of the last 5 quarters. Furthermore, the $48.4M in insider sales and the current 35.3x P/E multiple-which is 37% above the 5-year average-suggest the stock is priced for a growth trajectory that the underlying industrial business cannot support.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Normalization of Aerospace Aftermarket Growth As the post-pandemic surge in air travel stabilizes, the double-digit growth in aerospace spar...
Mid-Term (6-18 months)Impact: Critical
Filtration Group Integration Challenges The $9.3B acquisition is the largest in the company's history and carries significant integration ri...
Long-Term (18+ months)Impact: Moderate
Parker-Hannifin is relevant for analysis now because the stock is trading at a 37% premium to its 5-year average P/E while insiders have jus...
Primary Risks
Concern: High
Cyclical Peak in Industrial Demand A broader slowdown in global manufacturing could lead to a sustained decline in Diversified Industrial vo...
Concern: Medium
Intangible Asset Impairment With $18.1B in goodwill and intangibles (61% of assets), any failure to realize synergies from the Meggitt or Fi...
Concern: Medium
The stewardship verdict is Adequate but Cautionary. While the board is highly independent and the Win Strategy has successfully expanded mar...
Recent Activity
2025-11-06SEC Filing (8-K)
+7.75%Parker-Hannifin reported record first quarter fiscal 2026 results with increased outlook.
2025-01-30SEC Filing (8-K)
+5.72%Parker Hannifin reports record Q2 FY2025 results with 39% EPS growth and $1.1B debt reduction
2024-08-08SEC Filing (8-K)
+10.84%Parker Hannifin reports record FY2024 results with 36% EPS growth and issues FY2025 guidance
2024-02-01SEC Filing (8-K)
+7.68%Parker-Hannifin reported record second quarter fiscal 2024 results with increased outlook.
2023-11-02SEC Filing (8-K)
+9.21%Parker-Hannifin reported record first quarter fiscal 2024 results with increased outlook.
Valuation Table
9.8/10Decision Grade
Scenario Range
$526
Bear
$779
Base
$946
Bull
$982