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Parker-Hannifin (PH) Q1 Earnings Top, Revenues Miss Estimates

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Parker-Hannifin Corporation (PH - Free Report) reported mixed results for first-quarter fiscal 2019 (ended September 2018).

Earnings/ Revenues

Quarterly adjusted earnings came in at $2.84 per share, up 26.8% year over year. The bottom line also outpaced the Zacks Consensus Estimate of $2.51.

Revenues in the fiscal first quarter were $3,479.3 million, up 3.4% year over year. The revenue figure improved 6% year over year, organically, during the quarter. However, the top line fell short of the Zacks Consensus Estimate of $3,534 million.

Segmental Break-Up

Revenues in the North American segment in the fiscal first quarter came in at $1,681 million, up 5.4% year over year.

The company’s International top-line performance depreciated 0.4% to $1,233.8 million in the reported quarter.

Revenues in the Aerospace Systems segment came in at $564.5 million, up 6.3% year over year.

Parker-Hannifin Corporation Price, Consensus and EPS Surprise

 

Parker-Hannifin Corporation Price, Consensus and EPS Surprise | Parker-Hannifin Corporation Quote

Costs/Margins

Cost of sales in the fiscal first quarter was $2,594.8 million, up 2.8% year over year. Selling, general and administrative expenses were $394.3 million, slightly down from $397 million incurred in the year-ago quarter. Adjusted operating margin in the fiscal first quarter was 17.2%, up 120 basis points (bps) year over year.

Balance Sheet/Cash Flow

Exiting the fiscal first quarter 2019, Parker-Hannifin had cash and cash equivalents of $952.1 million, up from $822.1 million recorded as of Jun 30, 2018. Long-term debt stood at $4,313.2 million, down from $4,318.6 million recorded at the end of fiscal 2018.

In the first three months of fiscal 2019, the company generated $159.4 million cash from operating activities, down from $238 million witnessed in the comparable period last year. Capital expenditures totaled $42.1 million, down 46.9% year over year.

Outlook

Parker-Hannifin intends to boost its near-term revenues and profitability on the back of the company’s Win Strategy. Based on favorable market conditions, this Zacks Rank #3 (Hold) company has raised its earnings view for fiscal 2019 from $10.90-$11.50 to $11.10-$11.70 per share. Organic revenue growth is predicted to lie in the 2.5-5.3% range, higher than the prior view of 2.3-5.1%.

Stocks to Consider

Some better-ranked stocks in the Zacks Industrial Products sector are listed below:

Donaldson Company, Inc. (DCI - Free Report) sports a Zacks Rank #1 (Strong Buy), currently. The company delivered an average positive earnings surprise of 2.29% in the preceding four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.

Atkore International Group Inc. (ATKR - Free Report) carries a Zacks Rank #2 (Buy), at present. The company generated an average positive earnings surprise of 24.46% in the trailing four quarters.

Currently, Rockwell Automation, Inc. (ROK - Free Report) also holds a Zacks Rank of 2. The company came up with an average positive earnings surprise of 5.58% during the same time frame.

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