On Mar 20, 2014, we issued an updated research report on
). The company reported a modest performance for the second
quarter of fiscal 2014 due to incremental orders and improved
performance in its Industrial Sales business.
Parker delivered a positive earnings surprise in two of the
last four quarters, with an average beat of 1.17%. It reported
decent earnings in the first quarter of fiscal 2014, up 4.2% year
over year, but missed the Zacks Consensus Estimate by a
However, the company reduced its fiscal 2014 guidance.
Earnings from continuing operations for fiscal 2014 are currently
expected in the range of $6.20-$6.60 per share, down from its
earlier guidance of $7.78-$8.38 per share. The guidance includes
restructuring expenses of 47 cents per share.
Nevertheless, Parker-Hannifin has a healthy balance sheet and
generates strong cash flow. Over the past decade, Parker Hannifin
increased its operating cash flow from just $0.5 billion in 2001
to $1.8 billion in 2013. The company also offers healthy dividend
hikes, reflecting its commitment to rewarding shareholders with
risk-adjusted returns. In fiscal 2013, the company has
consecutively raised its dividend 4 times by 5%, reflecting a
yield of 1.5%.
Parker's modest results and guidance led to downward estimate
revisions for the current quarter and fiscal 2014. 6 out of 8
estimates for the current quarter and 4 out of 10 estimates for
fiscal 2014 were revised downward over the past 60 days. This led
to a significant decrease of 10 cents in the Zacks Consensus
Estimate for the current quarter, which is now at $1.66 per share
and a decline of 5 cents for fiscal 2014, which now stands at
$6.51 per share.
Other Stocks to Consider
Parker-Hannifin currently has a Zacks Rank #3 (Hold). Other
stocks worth considering include
Altra Industrial Motion Corp.
), all three carrying a Zacks Rank #2 (Buy).
ALTRA HOLDINGS (AIMC): Free Stock Analysis
MIDDLEBY CORP (MIDD): Free Stock Analysis
PARKER HANNIFIN (PH): Free Stock Analysis
XYLEM INC (XYL): Free Stock Analysis Report
To read this article on Zacks.com click here.