Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Shares of Parker-Hannifin Corp. (PH - Analyst Report) reached a new 52-week high of $100.58 on Monday, May 20, 2013. The new high was primarily driven by the company’s ability to consistently raise dividends and supported by its strong balance sheet. In addition, the company reported improved results for the third quarter of fiscal 2013.

The closing price of this fluid power systems and electromechanical controls manufacturer on May 20 was $100.58, representing a robust one-year return of about 21.53% and a decent year-to-date return of about 14.7%. Average volume of shares traded over the last three months was approximately 1,196K.

Parker has been delivering positive earnings surprises more often than not, although the last four quarters have averaged out at 0.06%. This Zacks Rank #3 (Hold) company has a market cap of $15.01 billion and a long-term expected earnings growth rate of 5.7%.

Parker’s Strengths

Parker has a strong balance sheet and generates strong cash flow. Over the past decade or so, Parker Hannifin has doubled its operating cash flow from just $0.5 billion in 2001 to $1.5 billion in 2012. In addition, Parker has returned value to shareholders in the form of share repurchases and dividends.

While dividend increases have been fairly consistent in the last few years, the company increased the dividend by a couple of cents (or roughly 5%) in each of the last two quarters.

In addition, Parker follows a “Win Strategy” that primarily aims to measure customer service excellence through efficient business and cash management strategies.  

Improved 3Q13 Earnings

Parker-Hannifin reported third-quarter 2013 earnings per share of $1.68, a penny above the Zacks Consensus Estimate.

Total revenue in the third quarter however declined 2.5% year over year to $3.30 billion, down from $3.39 billion in the prior-year quarter. Weak international markets and not very good returns from the American market continued to affect revenue in the quarter.

Conclusion

Although the quarterly earnings as well as revenue were not very encouraging for Parker, the company expressed confidence about a better fiscal 2013 given the improvement in its order trends.

Other Stocks to Consider

Other stocks in the machinery industry that are currently performing well and have a good visibility include Graco Inc (GGG - Snapshot Report) with a Zacks Rank #1 (Strong Buy) and Broadwind Energy, Inc. (BWEN - Snapshot Report) and Altra Holdings Inc. (AIMC - Snapshot Report), both with a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%