Parker(US:PH) ZACKS·2025-05-01 17:35Core Insights - Parker-Hannifin Corporation reported adjusted earnings of $6.94 per share for Q3 fiscal 2025, exceeding the Zacks Consensus Estimate of $6.73, with a year-over-year increase of 7% [1] - Total sales were $4.96 billion, falling short of the consensus estimate of $5 billion, and representing a 2% decrease year-over-year, while organic sales grew by 1% [1] - Orders increased by 9% year-over-year, indicating a positive trend in demand [1] Segmental Performance - The Diversified Industrial segment generated sales of $3.25 billion, accounting for 68.3% of total sales, but saw a year-over-year decline of 7.6% [2] - Sales from Diversified Industrial North America were $2.03 billion, down 9% year-over-year, while Diversified International sales were $1.36 billion, down 5.3% year-over-year [2] - Orders for Diversified Industrial North America increased by 3% year-over-year, and orders for Diversified Industrial International rose by 11% [3] Aerospace Systems Performance - The Aerospace Systems segment achieved sales of $1.57 billion, representing 31.7% of total sales, with an 11.6% year-over-year increase driven by aftermarket sales growth in both commercial and defense markets [4] - Orders for the Aerospace Systems unit increased by 14% year-over-year [4] Financial Metrics - Cost of sales was $3.13 billion, down 4.6% year-over-year, and selling, general, and administrative expenses decreased by 3.9% to $784.4 million [5] - Adjusted total segment operating income rose by 5.7% year-over-year to $1.15 billion, with an adjusted total segment operating margin of 23.2%, up 170 basis points year-over-year [5] Balance Sheet and Cash Flow - As of the end of Q3 fiscal 2025, cash and cash equivalents were $408.7 million, down from $422 million at the end of fiscal 2024, while long-term debt increased to $7.42 billion from $7.16 billion [6] - In the first nine months of fiscal 2025, net cash generated from operating activities was $2.31 billion, compared to $2.15 billion in the previous year [6] Capital Expenditures and Dividends - Capital spending for the first nine months totaled $304.2 million, up from $283.3 million in the prior year [7] - Cash dividends paid out amounted to $630.2 million, reflecting a year-over-year increase of 10.3% [7] Fiscal 2025 Guidance - The company updated its fiscal 2025 guidance, now expecting total sales to increase approximately 1% year-over-year, compared to a previous forecast of a 2% decrease to 1% increase [8] - Organic sales are projected to increase approximately 1%, down from an earlier expectation of 2% [8] - Adjusted operating margin is estimated to be around 25.9% [8] Earnings Expectations - Parker-Hannifin anticipates adjusted earnings to be in the range of $26.60-$26.80 per share, slightly revised from the previous expectation of $26.40-$27.00 [9][10]