(PH - Analyst Report
) continues to operate on all cylinders. This Zacks #2 Rank (buy) recently reported record quarterly sales, raised its dividend by 16% and kept its earnings surprise streak alive.
Originally founded in Cleveland in 1938, Parker Hannifin, which manufactures motion and control technologies for industrial and aerospace customers, now employs 55,000 people in 46 countries.
Quarterly Dividend Raised Again
On Apr 27, for the second time this year, Parker Hannifin raised its quarterly dividend. The dividend, payable on June 3, 2011 to shareholders of record as of May 10, 2011, rose 16% to 37 cents per share from 32 cents.
The company ranks among the top 5 in the S&P 500 in consecutive quarterly pay outs, with its streak extending to 244 quarters over 55 years.
Year to date, it has raised the dividend 52%. It currently yields 1.3%.
Record Fiscal 2011 Third Quarter
On Apr 27, the company reported its fiscal 2011 third quarter results and again beat the Zacks Consensus. It also saw its second record quarter in a row.
Sales jumped 24% to a third quarter record of $3.2 billion from $2.6 billion last year. All segments saw double digit increases in sales and order levels.
The Industrial International segment led the way as sales climbed 30% to $1.3 billion compared to a year ago. Industrial North America wasn't far behind, as sales rose 23% to $1.2 billion.
Earnings per share surged to an all-time company record of $1.68 per share, easily beating the Zacks Consensus of $1.54. The company only made 94 cents in the same quarter last year.
It was the 8th consecutive earnings surprise.
Consensus Estimates Rise
Analysts are still evaluating the recent earnings report, but 1 estimate has moved higher in the last week for fiscal 2011 which has pushed the Zacks Consensus up 10 cents to $6.29.
That is earnings growth of 84.9%.
Analysts expect another 12.4% earnings growth in fiscal 2012.
Shares Are Hot But There's Still Value
Shares have been trading near 10 year highs for awhile.
But even with the hot share price, the company isn't expensive.
It has a forward P/E of 14.8, which is just under the 15x cut-off I use for value stocks.
Its price-to-book ratio is 2.9, which is also just under the 3.0 cut-off.
Additionally, the company has a solid return on equity (ROE) of 17.6%.
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Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.