Why Motion & Control Technologies Provider Parker-Hannifin Shares Are Higher Today

Parker-Hannifin Corp PH shares are trading higher after the company reported better-than-expected second-quarter FY24 results and raised FY24 guidance.

Sales growth of 3.1% Y/Y to $4.821 billion and +2.9% on an organic basis, beating the consensus of $4.815 billion.

Orders increased 2% Y/Y, with a 4% decrease in Diversified Industrial North American businesses and 5% decline in Diversified Industrial International businesses. 

Orders increased by 21% Y/Y in the Aerospace Systems Segment on a rolling 12-month average basis.

Adjusted EPS improved to $6.15 from $4.76 in the second quarter of 2023, beating the consensus of $5.26.

Segment Sales: Diversified Industrial North America $2.1 billion (-1% Y/Y), Diversified Industrial International $1.4 billion (flat Y/Y), and Aerospace Systems $1.3 billion (+15% Y/Y).

The total segment operating margin for the quarter was 21.1%, and on an adjusted basis, the segment operating margin expanded 300 bps Y/Y to 24.5%.

Parker-Hannifin’s operating cash flow year-to-date totaled $1.4 billion, compared to $1.1 billion in comparable period. It held cash and equivalents of $393.9 million as of December 31, 2023.

FY24 Guidance Revised: The company raised its adjusted EPS expectation to $23.90-$24.50 from $22.60-$23.40 versus the consensus of $23.30.

Parker-Hannifin revised the total sales growth outlook to 3% to 5% (from the prior 2.5%-5.5% range) and segment operating margin to 20.7%-21.1%, or 24.1%-24.5% on an adjusted basis (vs. prior outlook of 20%-20.4%, or 23.4%-23.8% on an adjusted basis).

Dividend: The Board of Directors declared a regular quarterly cash dividend of $1.48 per share, payable on March 1, 2024, to shareholders of record as of February 9, 2024.

Price Action: PH shares are up 5.97% at $492.22 on the last check Thursday.

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