Key Stats for Parker-Hannifin Stock
- Past-6-Month Performance: 38%
- 52-Week Range: $488 to $1,024
- Valuation Model Target Price: $1,040
- Implied Upside: 1.7%
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What Happened?
Parker-Hannifin stock has climbed about 38% over the past six months, recently trading near $1,022 per share and approaching its $1,024 52-week high as investors rewarded accelerating aerospace growth and expanding margins.
The stock moved higher after management reinforced its growth outlook at this week’s Citi Global Industrial Tech & Mobility Conference.
CFO Todd Leombruno said aerospace is now in its fourth straight year of double-digit organic growth, North America industrial orders improved to +7%, and regional growth guidance increased to 2.5% after starting the year at 1%.
Management also reaffirmed 5% organic growth at the midpoint for fiscal 2026 and noted adjusted segment operating margins are tracking near 27%, three years ahead of its fiscal 2029 target, adding that “Aerospace continues to be great.”
The update strengthened confidence that earnings and margin expansion remain durable even before a full industrial rebound.
Institutional activity has also supported the rally. Citigroup raised its stake by 54.7% to 158,668 shares worth about $120.3 million, while NEOS Investment Management increased its position by 25.9% and Shell Asset Management more than doubled its holdings.
HighTower Advisors and the State of New Jersey Common Pension Fund D also added shares. Meanwhile, JPMorgan trimmed its stake by 14.1% and Vanguard reduced its holdings slightly but still owns about 8.78% of the company. Institutional ownership remains high at roughly 82.44%.
Sustained aerospace momentum, early signs of industrial recovery, and continued institutional participation have fueled the 38% advance.
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Is Parker-Hannifin Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 6.7%
- Operating Margins: 23.1%
- Exit P/E Multiple: 26x
Revenue is projected to increase from $19.85 billion in 2025 to $21.26 billion in 2026, supported by aerospace production ramp, improving industrial demand, and pricing discipline. Estimates then show revenue trending toward $25.86 billion by 2030.
Aerospace remains the primary earnings driver. Management expects 20% commercial OEM growth in fiscal 2026, and the segment continues to benefit from strong aftermarket mix and Meggitt integration gains. With margins already near 27%, Parker is reaching its long-term margin framework three years early.
Industrial markets are gradually stabilizing. North America orders turned positive at 7%, with construction, power generation, electronics, and selective distributor restocking contributing to momentum. Forward 2-year revenue growth of 7% and forward 2-year EPS growth of 11.6% suggest earnings could outpace sales if volumes continue improving.
The pending Filtration Group acquisition is expected to generate $220 million in synergies, while net debt to EBITDA of 1.74x and ROIC of 17.2% provide financial flexibility for additional capital returns and bolt-on acquisitions.
Based on these inputs, the valuation model estimates a target price of $1,040, implying about 1.7% total upside or 0.7% annually from current levels. At today’s price, the stock appears overvalued.
With shares already up 38% in six months, further upside in 2026 will depend on continued aerospace strength, faster industrial acceleration, and sustained margin expansion rather than multiple expansion.
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