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Parker-Hannifin (PH) Q2 Earnings Top Estimates, Revenues Miss
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Parker-Hannifin Corporation (PH - Free Report) reported second-quarter fiscal 2024 (ended Dec 31, 2023) adjusted earnings (excluding 92 cents from non-recurring items) of $6.15 per share, which beat the Zacks Consensus Estimate of $5.24. The bottom line jumped 29.2% year over year.
Total revenues of $4.820 billion missed the Zacks Consensus Estimate of $4.825 billion. The top line increased 3% year over year. Contributions from the Meggitt acquisition and operational improvement drove the company’s top line. Organic sales for the quarter increased 3% year over year. Orders were up 2% year over year.
Segmental Details
The Diversified Industrial segment’s revenues totaled $3.5 billion, representing 72.9% of net revenues for the quarter under review. On a year-over-year basis, the segment’s revenues decreased 0.8%.
Revenues generated in Diversified Industrial North America totaled $2.11 billion, down 1.4% year over year. The Zacks Consensus Estimate for the segment’s revenues was $2.16 billion.
International revenues were $1.40 billion, up 0.5% year over year. The consensus mark for Diversified International revenues was $1.39 billion. Orders for Diversified Industrial North America and Diversified Industrial International declined 4% and 5%, respectively, year over year.
The Aerospace Systems segment generated revenues of $1.31 billion, which accounted for 27.1% of net revenues for the reported quarter. Sales jumped 15% year over year, thanks to the contribution from the Meggitt acquisition (September 2022). The Zacks Consensus Estimate for Aerospace revenues was $1,271 million. Orders for the Aerospace Systems unit increased 21% on a rolling 12-month average basis.
Parker-Hannifin Corporation Price, Consensus and EPS Surprise
For the reported quarter, Parker-Hannifin’s cost of sales fell 4.2% year over year to $3.1 billion. Selling, general and administrative expenses decreased 1% from the prior year to $806.8 million.
Adjusted total segment operating income increased 17.2% year over year to $1.2 billion. Adjusted total segment operating margin increased 300 basis points year over year to 24.5%.
Balance Sheet & Cash Flow
Exiting the fiscal second quarter, Parker-Hannifin had cash and cash equivalents of $382.8 million compared with $475.2 million at the end of fiscal 2023.
Long-term debt was $8.11 billion compared with $8.80 billion at the end of fiscal 2023.
In the first six months of fiscal 2024, PH generated net cash of $1.35 billion from operating activities compared with $1.08 billion in the year-ago period.
Capital spending totaled $204.1 million in the reported quarter compared with $185.7 million in the year-ago period.
In the first six months of fiscal 2024, Parker-Hannifin paid out cash dividends of $381.1 million, up 11.3% from the year-ago period.
Fiscal 2024 Guidance Revised
PH expects total sales to increase 3-5% year over year compared with 2.5-5.5% anticipated earlier. Its total segment operating margin is estimated to be between 20.7% and 21.1%. Adjusted segment margin is expected to be 24.1-24.5%.
PH currently expects adjusted earnings of $23.90-$24.50 per share for fiscal 2024 compared with $22.60-$23.40 projected earlier.
Zacks Rank and Other Industrial Companies
PH currently carries a Zacks Rank #2 (Buy). Here are some other top-ranked stocks from the same space:
IDEX delivered a trailing four-quarter average earnings surprise of 4.9%. In the past 60 days, the Zacks Consensus Estimate for IEX’s 2023 earnings has been stable. The stock has gained 12.3% in the past three months.
Flowserve Corporation (FLS - Free Report) presently carries a Zacks Rank of 2. FLS delivered a trailing four-quarter average earnings surprise of 27.3%.
In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has remained steady. The stock has gained 7.4% in the past three months.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank #2. It has a trailing four-quarter average earnings surprise of 10.4%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 (ending June 2024) earnings remained steady in the past 60 days. Shares of Applied Industrial have jumped 13.9% in the past three months.
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Parker-Hannifin (PH) Q2 Earnings Top Estimates, Revenues Miss
Parker-Hannifin Corporation (PH - Free Report) reported second-quarter fiscal 2024 (ended Dec 31, 2023) adjusted earnings (excluding 92 cents from non-recurring items) of $6.15 per share, which beat the Zacks Consensus Estimate of $5.24. The bottom line jumped 29.2% year over year.
Total revenues of $4.820 billion missed the Zacks Consensus Estimate of $4.825 billion. The top line increased 3% year over year. Contributions from the Meggitt acquisition and operational improvement drove the company’s top line. Organic sales for the quarter increased 3% year over year. Orders were up 2% year over year.
Segmental Details
The Diversified Industrial segment’s revenues totaled $3.5 billion, representing 72.9% of net revenues for the quarter under review. On a year-over-year basis, the segment’s revenues decreased 0.8%.
Revenues generated in Diversified Industrial North America totaled $2.11 billion, down 1.4% year over year. The Zacks Consensus Estimate for the segment’s revenues was $2.16 billion.
International revenues were $1.40 billion, up 0.5% year over year. The consensus mark for Diversified International revenues was $1.39 billion.
Orders for Diversified Industrial North America and Diversified Industrial International declined 4% and 5%, respectively, year over year.
The Aerospace Systems segment generated revenues of $1.31 billion, which accounted for 27.1% of net revenues for the reported quarter. Sales jumped 15% year over year, thanks to the contribution from the Meggitt acquisition (September 2022). The Zacks Consensus Estimate for Aerospace revenues was $1,271 million. Orders for the Aerospace Systems unit increased 21% on a rolling 12-month average basis.
Parker-Hannifin Corporation Price, Consensus and EPS Surprise
Parker-Hannifin Corporation price-consensus-eps-surprise-chart | Parker-Hannifin Corporation Quote
Margin Profile
For the reported quarter, Parker-Hannifin’s cost of sales fell 4.2% year over year to $3.1 billion. Selling, general and administrative expenses decreased 1% from the prior year to $806.8 million.
Adjusted total segment operating income increased 17.2% year over year to $1.2 billion. Adjusted total segment operating margin increased 300 basis points year over year to 24.5%.
Balance Sheet & Cash Flow
Exiting the fiscal second quarter, Parker-Hannifin had cash and cash equivalents of $382.8 million compared with $475.2 million at the end of fiscal 2023.
Long-term debt was $8.11 billion compared with $8.80 billion at the end of fiscal 2023.
In the first six months of fiscal 2024, PH generated net cash of $1.35 billion from operating activities compared with $1.08 billion in the year-ago period.
Capital spending totaled $204.1 million in the reported quarter compared with $185.7 million in the year-ago period.
In the first six months of fiscal 2024, Parker-Hannifin paid out cash dividends of $381.1 million, up 11.3% from the year-ago period.
Fiscal 2024 Guidance Revised
PH expects total sales to increase 3-5% year over year compared with 2.5-5.5% anticipated earlier. Its total segment operating margin is estimated to be between 20.7% and 21.1%. Adjusted segment margin is expected to be 24.1-24.5%.
PH currently expects adjusted earnings of $23.90-$24.50 per share for fiscal 2024 compared with $22.60-$23.40 projected earlier.
Zacks Rank and Other Industrial Companies
PH currently carries a Zacks Rank #2 (Buy). Here are some other top-ranked stocks from the same space:
IDEX Corporation (IEX - Free Report) presently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
IDEX delivered a trailing four-quarter average earnings surprise of 4.9%. In the past 60 days, the Zacks Consensus Estimate for IEX’s 2023 earnings has been stable. The stock has gained 12.3% in the past three months.
Flowserve Corporation (FLS - Free Report) presently carries a Zacks Rank of 2. FLS delivered a trailing four-quarter average earnings surprise of 27.3%.
In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has remained steady. The stock has gained 7.4% in the past three months.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank #2. It has a trailing four-quarter average earnings surprise of 10.4%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 (ending June 2024) earnings remained steady in the past 60 days. Shares of Applied Industrial have jumped 13.9% in the past three months.