PH US S&P 500Russell 1000 Earnings call
Parker Hannifin (PH) · Q2 2026 results and valuation
Share price: $972.90 · 2026-11-11
Parker-Hannifin designs, manufactures, and provides aftermarket support for motion and control technologies. The company serves original equipment manufacturers and distributors in the aerospace, defense, industrial, transportation, energy, and HVAC markets worldwide. Source: 10-K annual report (2026-08-21)
Results Q2 2026 vs Q1 2026 · previous quarter · fiscal Q4 2026 · published 6 Aug 2026 and 30 Apr 2026
Net income up 20.8% on the previous quarter. Management sounded cautious, though noticeably more positive answering analysts.
1 · Numbers
+20.8%
Net income vs Q1 2026
Outlook given
Net income 1.09B vs 904.0M
Revenue +4.9%
Against the same quarter last year (Q2 2025) it is +18.3%, so it is not just seasonal.
Why Against the same quarter last year (+18.3%), net income rose because organic growth accelerated to 6.6% and adjusted segment operating margin expanded 120 basis points to a record 27.3%.
2 · How management spoke
Cautious
Among the least upbeat of all company calls
Answers to analysts: very upbeat, and more positive than the script.
Last call it was different: script and answers matched.
3 · What stood out
Parker achieved record fiscal year 2026 sales of $21.5 billion, surpassing $20 billion for the first time in the company's history.
Valuation
Is Parker Hannifin undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2026-06-30), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 4.1% growth a year (3-year revenue growth), the model's fair value is $363.51 a share — the stock trades 168% above it. Today's price assumes 15.3% growth a year.
Current price
$972.90
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+15.3% for 10 yrs
Fair value / share
$363.51
Buy below
$272.63
Price vs fair value
Overvalued 168%
Price vs buy-below price
Overvalued >200%
Management expects
Sales +7% · from the Q2 2026 report: “PH is projecting organic growth of 7% at the midpoint because, for the first time ever, the company is guiding positive sales growth across all market…”
A guidance figure for sales, usually one year ahead, not a 10-year free-cash-flow rate.
Read between the lines
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Guidance
The company restated its target to fiscal year 2031 and set a new goal of 30% adjusted segment operating margins.
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Figure
Parker achieved record fiscal year '26 sales of $21.5 billion, surpassing $20 billion for the first time in the company's history.
Source quote
“We delivered record fiscal year '26 sales of $21.5 billion, surpassing $20 billion for the first time in Parker's history.”
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Figure
Parker Hannifin reported sales growth for the year is projected to be in the range of 5.5% to 8.5% or 7% at the midpoint.
Source quote
“Reported sales growth for the year is going to be in the range of 5.5% to 8.5% or 7% at the midpoint.”
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Guidance
PH raised its margin target to 30% for the current period.
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Figure
Sales from this segment rose to 1.5% of total sales from the previously stated 1%.
Source quote
“It's about 1.5% of our sales, and we've been previously saying 1%.”
4 more
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Figure
The pending acquisition of Filtration Group Corporation expands proprietary filtration technologies and increases the filtration aftermarket by 500 basis points.
Source quote
“In November, we announced the pending acquisition of Filtration Group Corporation, which expands our offering of proprietary filtration technologies and increases our filtration aftermarket by 500 basis points.”
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Figure
The company will move to rolling 12-month order rates for its Industrial segment in fiscal year '27 to align all businesses on a rolling 12-month calculation.
Source quote
“Today, we are announcing a move to rolling 12-month order rates beginning in fiscal year '27 for our Industrial segment, aligning all businesses on a rolling 12-month calculation.”
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Figure
Cash flow from operations reached $4.4 billion, surpassing the $4 billion mark for the first time in company history.
Source quote
“Cash flow from operations surpassed $4 billion for the first time ever in the history of the company, really blew it away at $4.4 billion.”
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Guidance
PH is projecting organic growth of 7% at the midpoint because, for the first time ever, the company is guiding positive sales growth across all market verticals.
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Management was more positive answering analysts than in its script — usually a sign it was comfortable with the details it was asked about.
Sentences that drove the tone
“But we've also seen agriculture remain where it's been pretty soft and automotive pretty soft.”
“Lower share count, we've done a significant amount of share buybacks over the last year that added $0.09 to the quarter and lower interest expense added $0.02.”
“And even with all those actions, we still reduced debt by $1 billion in the quarter, bringing our net debt to adjusted EBITDA to 1.4x.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-06-30)
| Metric | Q2 2026period end 2026-06-30 | Q1 2026period end 2026-03-31 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 5.75B | 5.49B | +4.9% | 5.24B | +9.8% |
| Gross profit | 2.25B | 2.02B | +11.4% | 1.96B | +14.8% |
| Operating income | 1.47B | 1.23B | +19.9% | 1.19B | +24.0% |
| Net income | 1.09B | 904.0M | +20.8% | 923.0M | +18.3% |
| EPS | 8.53 | 7.06 | +20.8% | 7.15 | +19.3% |
| P/E today 31.5 | 34.3 | 33.0 | +1.3 | 25.8 | +8.5 |
Topics
Most discussed now
- If Parker Hannifin moves to the North American businesses, sales were $2.2 billion.
- Demand for legacy and missile programs continues, increasing defense budgets in response to what's going on in the world and...
- Positive orders across all the major market verticals, but really, the strength is electronics.
- Parker's portfolio is profoundly different today than it was 20 years ago when Parker Hannifin began disclosing quarterly order rate…
- New Parker Hannifin definitely feel like that is a broadening recovery instead of what it has just been saying as a gradual recovery.
Faded since Q1 2026
- Fading Parker Hannifin achieved top quartile safety performance with a 12% reduction in its recordable incident rate.
- Fading Main driver continues to be increased segment operating income dollars.
- Fading Adjusted net income surpassed $1 billion for the first time ever, and that is a 19.1% return on sales.
- Fading Even though global air traffic growth is beginning to normalize, Parker Hannifin still saw nice growth in Q3 and strong spares...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations · SEC 8-K
- Shareholder vote results · SEC 8-K · routine
- Other events · SEC 8-K
Parker-Hannifin Corporation completed a registered offering of $2.4 billion in U.S. senior notes and €2.025 billion in Euro senior notes on September 14, 2026.
- Other events · SEC 8-K
Parker-Hannifin Corporation entered into an underwriting agreement to issue and sell $2.4 billion in U.S. Notes on September 8, 2026.
- Other events · SEC 8-K
On September 4, 2026, Parker-Hannifin Corporation entered into a new revolving credit agreement and increased its commercial paper program to $5.0 billion.
- Acquisition or disposal; New financial obligation · SEC 8-K
- Results of operations · SEC 8-K
Parker-Hannifin Corporation issued a press release on August 6, 2026, reporting its results of operations for the quarter ended June 30, 2026.
- Results of operations · SEC 8-K
Parker-Hannifin Corporation issued a press release on April 30, 2026, regarding its results of operations for the quarter ended March 31, 2026.
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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FY '31
adjusted segment operating margin target
Source quote
“We are raising it by 300 basis points to 30% by fiscal year '31.”
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fiscal year '27
move to rolling 12-month order rates beginning in fiscal year '27 for our Industrial segment
Source quote
“Today, we are announcing a move to rolling 12-month order rates beginning in fiscal year '27 for our Industrial segment, aligning all businesses on a rolling 12-month calculation.”
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beginning in FY '27
convert to order reporting for all businesses using a 12-month rolling
Source quote
“Jenny just mentioned this, but beginning in FY '27, we will convert to order reporting for all businesses using a 12-month rolling.”
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fiscal year '27
high single-digit organic growth for aerospace and defense
Source quote
“For aerospace and defense, our largest vertical, we are guiding high single-digit organic growth.”
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fiscal year '27 and beyond
solid outlook for defense orders
Source quote
“Defense orders finished strong, supporting a solid outlook for fiscal year '27 and beyond.”