# Parker-Hannifin Corporation (PH) — Financial Analysis

**Exchange:** NYSE  
**Coverage as of:** 2026-Q2  
**Updated:** 2026-05-29  
**Tier:** Free primer (step 2 of 19)  
**Sibling pages:** /stocks/PH/thesis · /stocks/PH/memo

## Financial Snapshot

---
source: coverage-next-full
ticker: PH
step: "04"
title: Financial Snapshot — 3-Year P&L Summary
created: 2026-05-29
---

### Step 04: Financial Snapshot

#### Income Statement Summary (FY2022–FY2024)

All figures in USD millions unless noted. Parker's fiscal year ends June 30.

| Metric | FY2022 | FY2023 | FY2024E |
|--------|--------|--------|---------|
| Net Revenue | $15,860 | $19,956 | ~$20,000 |
| YoY Revenue Growth | +16.4% | +25.9% | ~+0-2% |
| Organic Growth | ~+9% | ~+11% | ~+2-4% |
| Gross Profit | ~$4,800 | ~$6,400 | ~$6,800 |
| Gross Margin | ~30.3% | ~32.1% | ~34% |
| Adjusted EBITDA | ~$3,100 | ~$4,200 | ~$4,400 |
| Adjusted EBITDA Margin | ~19.5% | ~21.0% | ~22%+ |
| Adjusted Operating Income | ~$2,600 | ~$3,600 | ~$3,800 |
| Adjusted Operating Margin | ~16.4% | ~18.0% | ~19%+ |
| GAAP Net Income | ~$1,100 | ~$1,700 | ~$2,000 |
| Adjusted EPS | ~$13.00 | ~$19.00 | ~$22-23 |
| D&A | ~$750 | ~$950 | ~$950 |
| CapEx | ~$320 | ~$360 | ~$380 |
| Free Cash Flow (adj.) | ~$2,000 | ~$2,800 | ~$3,000 |
| FCF Conversion (% Net Income) | ~85% | ~90%+ | ~90%+ |

*Note: FY2022 reflects partial Meggitt contribution (closed September 2022). FY2023 first full year of Meggitt. FY2024E based on guidance and analyst consensus.*

#### Margin Progression vs. Win Strategy 3.0 Targets

Parker's margin trajectory has been one of the most compelling industrial sector stories of the past decade:

| FY | Adj. EBITDA Margin | YoY Change | Distance to 25% Target |
|----|-------------------|------------|------------------------|
| FY2019 | ~16.8% | — | -8.2pp |
| FY2020 | ~17.2% | +0.4pp | -7.8pp |
| FY2021 | ~18.5% | +1.3pp | -6.5pp |
| FY2022 | ~19.5% | +1.0pp | -5.5pp |
| FY2023 | ~21.0% | +1.5pp | -4.0pp |
| FY2024E | ~22.0-22.5% | ~+1.0-1.5pp | -2.5-3.0pp |
| FY2025 Target | 25.0% | — | 0pp |

The path from ~22.5% to 25% by FY2025 requires approximately 250bp of additional margin expansion in one year — achievable through:
1. Meggitt cost synergies ($300M target, with ~$150-200M realized by FY2024)
2. Pricing power (Parker has demonstrated ability to sustain price above material cost inflation)
3. Volume leverage (industrial recovery in FY2025)
4. Mix shift toward higher-margin Aerospace aftermarket

#### Segment-Level Financial Detail

##### DINA (Diversified Industrial North America)
| Metric | FY2022 | FY2023 | FY2024E |
|--------|--------|--------|---------|
| Revenue | ~$8,500M | ~$9,200M | ~$9,000M |
| Adj. Operating Margin | ~20% | ~22% | ~22-23% |
| Organic Growth | ~+8% | ~+8% | ~+1-2% |

DINA is the most mature segment with the strongest pricing discipline. Margin expansion here has been driven by Lean manufacturing, SKU rationalization, and price/cost management. The segment was impacted by industrial destocking in FY2024.

##### DII (Diversified Industrial International)
| Metric | FY2022 | FY2023 | FY2024E |
|--------|--------|--------|---------|
| Revenue | ~$4,800M | ~$5,800M | ~$5,800M |
| Adj. Operating Margin | ~17% | ~19% | ~19-20% |
| Organic Growth | ~+9% | ~+10% | ~flat |

DII is the most FX-exposed segment. European industrial weakness (Germany's manufacturing recession in particular) has been a headwind. China softness also affects DII disproportionately.

##### Aerospace Systems
| Metric | FY2022 | FY2023 | FY2024E |
|--------|--------|--------|---------|
| Revenue | ~$2,560M | ~$4,956M | ~$5,200M |
| Adj. Operating Margin | ~21% | ~22% | ~24-26% |
| Organic Growth | ~+12% | ~+15% | ~+8-10% |

Aerospace is the fastest-growing and highest-quality segment. The FY2023 jump reflects the first full year of Meggitt. Margin expansion here is driven by aftermarket mix improvement, Meggitt synergies, and aerospace OEM volume ramp.

#### Key P&L Drivers and Sensitivity

##### Revenue Sensitivity
- 1pp change in organic growth ≈ ~$200M revenue impact
- 1% USD appreciation vs. Euro basket ≈ ~$80-100M revenue headwind
- Aerospace aftermarket +10% ≈ ~$200M incremental revenue

##### Margin Sensitivity
- 100bps raw material cost inflation: ~$180-200M EBITDA headwind
- 1pp pricing increase (net of cost): ~$200M EBITDA benefit
- $100M Meggitt synergy: ~50bps EBITDA margin benefit
- 1pp aerospace aftermarket mix shift: ~15-20bps consolidated EBITDA margin

#### Profitability Quality Metrics

| Metric | FY2023 | Context |
|--------|--------|---------|
| Gross Margin | ~32% | Below HON (~35%), above many peers |
| EBIT Margin (adj.) | ~18% | Strong and expanding |
| EBITDA Margin (adj.) | ~21% | On track to 25% target |
| Net Margin (GAAP) | ~8.5% | Depressed by Meggitt D&A and interest |
| FCF Yield (mkt cap) | ~4-5% | Attractive for quality industrial |
| FCF/Net Income | ~90%+ | High quality earnings |
| EPS CAGR (FY2019-FY2024) | ~12-15% | Excellent compounding |

#### Interest Expense Impact

The Meggitt acquisition added significant debt, which is a meaningful drag on GAAP EPS:
- FY2023 interest expense: ~$600-650M (vs. ~$250M pre-Meggitt)
- Each 25bps of rate change on variable debt: ~$20-25M impact on interest expense
- As debt is repaid (targeting ~$1B/year in debt reduction), interest savings flow directly to EPS

#### Adjusted vs. GAAP Reconciliation Note

Parker discloses meaningful GAAP-to-adjusted reconciliations. Key exclusions from adjusted metrics:
- **Acquisition-related amortization**: Meggitt created a large intangible asset base; annual amortization of ~$500-600M significantly depresses GAAP EPS vs. adjusted EPS
- **Transaction/integration costs**: One-time Meggitt integration charges
- **Restructuring charges**: Ongoing operational footprint rationalization (~$100-150M/year)

Adjusted EPS is approximately $22-23 for FY2024, while GAAP EPS is approximately $15-17, a ~$6-7 gap primarily driven by acquisition-related amortization.

## Deeper Financial Analysis

The fundamental tier ($1.00) adds 8 dimensions not included here:

- Revenue Breakdown — segment revenue, geographic mix, product-line margins
- Financial Trends — QoQ momentum, leading indicators, inflection points
- Balance Sheet — debt structure, dilution risk, working capital dynamics
- Capital Allocation — ROIC, buyback cadence, reinvestment efficiency
- Earnings Analysis — beats/misses, guidance vs actuals, transcript highlights
- Competitive Positioning — market share, pricing power, peer benchmarks
- Industry Context — TAM, sector tailwinds/headwinds, regulatory backdrop

**API endpoint:** GET /api/v1/research/PH/fundamental

## Navigation

- Overview: /stocks/PH
- Financials (this page): /stocks/PH/financials
- Thesis: /stocks/PH/thesis
- Investment Memo: /stocks/PH/memo
- Coverage universe: /stocks