Core Viewpoint - Analysts project that Parker-Hannifin (PH) will report quarterly earnings of $7.15 per share, reflecting a year-over-year increase of 9.5%, with revenues expected to reach $5.04 billion, up 6.3% from the same quarter last year [1]. Earnings Estimates - The consensus EPS estimate has been revised upward by 0.6% in the past 30 days, indicating a reassessment of initial estimates by covering analysts [2]. - Revisions to earnings projections are crucial for predicting investor behavior and are strongly linked to short-term stock price performance [3]. Key Metrics Projections - Analysts estimate 'Net Sales- Aerospace Systems' will reach $1.67 billion, an increase of 11.9% year-over-year [5]. - 'Net Sales- Diversified Industrial- International' is projected at $1.44 billion, reflecting an 8.5% increase from the prior year [5]. - 'Net Sales- Diversified Industrial- North America' is expected to be $1.96 billion, showing a year-over-year change of 1.7% [5]. Sales Growth - Reported sales growth for 'Aerospace Systems' is anticipated to be 11.9%, down from 14.0% reported in the same quarter last year [6]. - Organic sales growth for 'Aerospace Systems' is forecasted at 10.2%, also lower than the 14.0% reported in the previous year [6]. Operating Income Estimates - The consensus for 'Adjusted segment operating income- Diversified Industrial- North America' is $505.32 million, compared to $426.57 million reported in the same quarter last year [7]. - 'Adjusted segment operating income- Aerospace Systems' is expected to be $496.49 million, up from $338.18 million reported in the same quarter last year [7]. - Analysts project 'Adjusted segment operating income- Diversified Industrial- International' to reach $347.77 million, compared to $284.00 million reported in the same quarter last year [8]. Stock Performance - Over the past month, Parker-Hannifin shares have returned +4.5%, outperforming the Zacks S&P 500 composite's +0.2% change [8].

Core Viewpoint - Parker-Hannifin Corporation had a strong performance in 2025, with shares increasing by 38.2%, making it an attractive investment opportunity for industrial investors during pullbacks [1]. Financial Performance - The aerospace segment, which is the largest for Parker-Hannifin, experienced significant growth, contributing to margin expansion and multiple earnings beats [2]. - In fiscal 2025, the aerospace division grew by 13% and expanded operating margins by 300 basis points, offsetting a 3% decline in the general industrial segment [4]. - The first fiscal quarter of 2025 saw revenue growth accelerate to 3.7%, or 5% when accounting for divestitures, with adjusted earnings per share increasing by 16% [5]. Acquisitions and Strategy - Parker-Hannifin made two notable acquisitions in 2025: Curtis Instruments for $1 billion and Filtration Group for $9.25 billion, enhancing its presence in the electric vehicle and industrial filtration markets [6]. - The successful integration of Meggitt PLC, acquired for approximately $7.3 billion, contributed to the company's strong performance and cost synergies [4]. Market Position and Valuation - Parker-Hannifin is recognized as a high-performing company with a "Win 3.0" business excellence strategy, which has proven effective in a challenging macroeconomic environment [7]. - Currently, shares are trading at 33 times earnings, which is at the high end of the valuation range for the past decade, indicating that while the company may be fairly valued to over-valued, it remains a high-quality investment option [8].

Core Viewpoint - Parker-Hannifin Corporation is facing softer sales trends and inventory levels, but is making strategic moves to strengthen its market position through acquisitions [2][3] Group 1: Financial Performance and Market Trends - Stifel analyst Nathan Jones reiterated a Hold rating on Parker-Hannifin with a price target of $869, citing a distributor survey indicating softer Q2 results and lower sales trends [2] - Distributors highlighted tariffs, local economic conditions, and inflation as significant factors affecting demand, although fewer expect a recession within the next year [2] Group 2: Strategic Acquisition - Parker announced plans to acquire Filtration Group for $9.25 billion, aimed at enhancing its aftermarket business, which is crucial for steady revenue streams [3][6] - Filtration Group generates about 85% of its revenue from the aftermarket and is projected to achieve approximately $2 billion in sales by 2025 [4] Group 3: Industry Dynamics - There is a growing investor interest in filtration and water-related businesses due to increasing demand for cleaner air and water, which aligns with Parker's strategic focus [5] - Parker plans to fund the acquisition through a combination of new debt and cash, with the transaction expected to close within six to twelve months, pending regulatory approvals [6]

Core Viewpoint - Parker Hannifin Corporation will release its fiscal 2026 second quarter earnings on January 29, 2026, and will hold a conference call to discuss the results and answer questions from investors and analysts [1]. Company Overview - Parker Hannifin is a Fortune 250 global leader in motion and control technologies, with over a century of experience in enabling engineering breakthroughs [2]. - The company has a strong track record of increasing its annual dividend per share for 69 consecutive fiscal years, ranking among the top five longest-running dividend-increase records in the S&P 500 index [2]. Investor Communication - The earnings conference call will take place at 11:00 a.m. Eastern time and will be webcast on Parker's investor website, with an accompanying slide presentation [1]. - The webcast will be archived and available for replay later on the same day [1].

Core Viewpoint - Parker-Hannifin Corporation is a leader in the motion and control technology industry, known for its innovative products and solutions across various sectors [1] Group 1: Stock Performance and Analyst Ratings - Morgan Stanley maintains a "Positive" grade for Parker-Hannifin, raising the price target from $725 to $945, indicating confidence in the company's future performance [2][6] - The current stock price of Parker-Hannifin is $930.40, with a market capitalization of approximately $118.86 billion [5][6] - The stock has experienced a decrease of $7.95, or about 0.85%, with a trading volume of 36,151 shares [5] Group 2: Earnings Performance - Parker-Hannifin has consistently outperformed earnings estimates, with an average earnings surprise of 8.43% over the last two quarters [3][6] - In the most recent quarter, the company reported earnings of $7.22 per share, exceeding the expected $6.67, resulting in an 8.25% surprise [3] - In the previous quarter, Parker-Hannifin delivered $7.69 per share, surpassing the consensus estimate of $7.08, leading to an 8.62% surprise [4]

Core Insights - The AI-driven bull run of 2023 and 2024 has continued into 2025, with significant interest in old economy stocks from sectors such as industrials, finance, auto, materials, and construction [1][2] Company Summaries Wells Fargo & Co. (WFC) - Wells Fargo has consistently surpassed earnings estimates in the last four quarters, benefiting from the Federal Reserve's removal of a $1.95 trillion asset cap, which allows for growth in deposits, loans, and fee-based services [6][7] - The bank's expected revenue and earnings growth rates for the current year are 5.4% and 11.7%, respectively, with a 0.7% improvement in the Zacks Consensus Estimate for earnings over the last 30 days [8] MasTec Inc. (MTZ) - MasTec is positioned to benefit from a surge in infrastructure spending related to AI data centers and electrification trends, with an expected revenue growth rate of 8.4% and earnings growth rate of 28.3% for the current year [11][13] - The company operates in four segments: Communications, Power Delivery, Pipeline Infrastructure, and Clean Energy and Infrastructure, all of which are experiencing growth due to increased infrastructure spending [12][13] Curtiss-Wright Corp. (CW) - Curtiss-Wright is benefiting from the global shift towards alternative energy, particularly in nuclear power, and has an expected revenue growth rate of 6.9% and earnings growth rate of 11.6% for the current year [14][16] - The company plays a significant role in the construction of new nuclear power plants, which is expected to drive long-term growth in commercial nuclear energy [15] Leidos Holdings Inc. (LDOS) - Leidos Holdings has a solid backlog of $47.66 billion, driven by increased orders from the Pentagon and other U.S. allies, which enhances its revenue-generation prospects [17] - The expected revenue and earnings growth rates for the current year are 3.4% and 4.8%, respectively, with a slight improvement in the Zacks Consensus Estimate for earnings over the last 30 days [19] Parker-Hannifin Corp. (PH) - Parker-Hannifin is experiencing steady demand in both commercial and military markets, with its Aerospace Systems segment revenues increasing approximately 13.3% year over year in the first quarter of fiscal 2026 [20][21] - The expected revenue and earnings growth rates for the current year are 6.1% and 10.6%, respectively, with a minor improvement in the Zacks Consensus Estimate for earnings over the last 30 days [23]

Core Viewpoint - Parker Hannifin Inc. has shown strong stock performance, with a 5.63% increase over the past month and a 43.49% increase over the past year, leading to optimism among long-term shareholders [1] Group 1: Stock Performance - The current stock price of Parker Hannifin Inc. is $894.51, reflecting a 0.06% increase in the current session [1] - Over the past month, the stock has increased by 5.63%, and over the past year, it has increased by 43.49% [1] Group 2: Price-to-Earnings (P/E) Ratio - The P/E ratio is a critical metric for assessing the company's market performance, comparing the current share price to the company's earnings per share (EPS) [5] - Parker Hannifin Inc. has a P/E ratio of 31.85, which is lower than the industry average P/E ratio of 39.37 in the Machinery sector [6] - A lower P/E ratio may suggest that the stock is undervalued or that shareholders do not expect future growth [9][10] Group 3: Investment Implications - Investors may view the lower P/E ratio as an indication that the stock could perform worse than its industry peers, but it may also indicate undervaluation [6] - The P/E ratio should not be used in isolation; it is essential to consider other financial metrics and qualitative factors for informed investment decisions [10]

Core Viewpoint - Parker-Hannifin Corporation (PH) is a leading diversified industrial manufacturer with a market cap of $110.9 billion, expected to announce its fiscal second-quarter earnings for 2026 soon [1] Financial Performance - Analysts anticipate PH will report a profit of $7.11 per share on a diluted basis, reflecting an 8.9% increase from $6.53 per share in the same quarter last year [2] - For the full fiscal year, EPS is projected to be $30.39, an 11.2% rise from $27.33 in fiscal 2025, with expectations of further growth to $32.96 in fiscal 2027 [3] Stock Performance - PH stock has increased by 38% over the past 52 weeks, outperforming the S&P 500 Index's 16.4% gains and the Industrial Select Sector SPDR Fund's 17.6% gains during the same period [4] Growth Drivers - The company's strong organic growth is attributed to robust performance in aerospace and defense, along with a recovery in North American industrial operations [5] - Key growth factors include commercial and aftermarket aerospace growth, enhanced productivity, effective cost controls, and successful integration of Curtis Instruments [5] Recent Earnings Report - On November 6, PH shares rose by 7.8% following the Q1 results, with adjusted EPS of $7.22 surpassing Wall Street's expectations of $6.67, and revenue of $5.1 billion exceeding the forecast of $4.9 billion [6] Analyst Sentiment - The consensus opinion on PH stock is bullish, with a "Strong Buy" rating from 16 out of 23 analysts, one suggesting a "Moderate Buy," and six giving a "Hold" rating [7] - The average analyst price target for PH is $940.95, indicating a potential upside of 7.1% from current levels [7]

Core Insights - Parker-Hannifin Corporation is approaching its largest M&A deal in history, which is expected to enhance investor satisfaction due to strong momentum in the company [1] Valuation Methods - Various methods exist for sell-side analysts to determine a company's fair value, including DCF, multiples approach, and reverse valuation, each with its own strengths and weaknesses [1] - The DCF method requires precise assumptions and can introduce biases, while the multiples approach relies on the assumption that peer companies are fairly priced, which is often not the case [1] - Reverse valuation starts from the market price and discount rate, working backward to reveal the free cash flow assumptions embedded in the price, providing a more straightforward assessment of market beliefs [1] Free Cash Flow Analysis - The Free Cash Flow to Equity (FCFE) model is utilized to determine what belongs to shareholders, calculated as Earnings + Amortization – CAPEX – average acquisition cost = FCFE, ignoring working capital and debt changes [1] - The analysis focuses on three key numbers: earnings, amortization, and investments [1] Forecasting Approach - The H-model is applied for forecasts, which includes a 10-year two-stage growth fade with terminal growth equal to the risk-free rate, specifically the 10-year government bond yield [1] - All cash flows are discounted using the cost of equity, calculated as RFR × beta + 5% ERP, resulting in a clear picture of the business's true worth [1]

Core Insights - Parker-Hannifin Corporation (PH) is experiencing strong growth in its Aerospace Systems segment, with revenues increasing approximately 13.3% year over year in Q1 of fiscal 2026 [1][8] - The company anticipates continued demand in the Aerospace Systems segment, projecting organic sales growth of 8-11% for fiscal 2026 [2][8] - Overall, PH has raised its fiscal 2026 guidance, expecting total sales to grow by 4-7% year over year [4][8] Aerospace Systems Segment - The Aerospace Systems segment is benefiting from robust demand in both commercial and military markets, including OEM and aftermarket channels [1] - Growth in the general aviation market and stable defense spending are expected to further support this segment [2] - The segment's strong performance is attributed to increased air transport activities and aftermarket support services [2] Market Trends - Key trends such as advancements in clean technologies, automation, infrastructure investments, digitalization, and electrification are expected to drive long-term growth across various end markets [3] Peer Comparison - Honeywell International Inc. is also seeing strong performance in its commercial aviation aftermarket, with organic sales increasing by 19% year over year [5] - RBC Bearings Incorporated reported a 38.8% year-over-year revenue increase in its Aerospace/Defense segment, driven by strong orders from both OEM and aftermarket [6] Financial Performance and Valuation - Parker-Hannifin's shares have increased by 17.9% over the past three months, contrasting with a 6.8% decline in the industry [10] - The company is currently trading at a forward price-to-earnings ratio of 28.19X, which is above the industry average of 21.88X [12] - The Zacks Consensus Estimate for PH's fiscal 2026 earnings has risen by 3.8% over the past 60 days [12]