Here’s how much a $1,000 investment in Parker-Hannifin made 10 years ago would be worth today

What matters to most investors is how much a stock’s price changes over time. Not only can it influence your investment portfolio, but it can also help you compare investment performance across sectors and industries.

FOMO, or fear of missing out, also plays a role in investing, especially in tech giants and popular consumer-focused stocks.

What if you had invested in Parker-Hannifin (PH) ten years ago? It may not have been easy to hold on to PH all this time, but if you did, how much would your investment be worth today?

Parker-Hannifin’s in-depth business

With that in mind, let’s look at the main drivers of Parker-Hannifin’s business.

Parker-Hannifin Corporation is a global diversified manufacturer of motion and control technologies and systems. The company provides precision engineering solutions for a wide variety of mobile, industrial and aerospace markets.

Diversified Industrial Segment (77.1% of fiscal 2023 sales): This segment manufactures a wide range of motion and fluid control systems and components. The products offered by this segment are used in transportation, mobile construction, refrigeration and air conditioning, agriculture and other markets.

The segment sells its products through two main channels, namely original equipment manufacturers (OEMs) and a wide distribution network to smaller OEMs and the aftermarket.

Products offered include sealing devices (dynamic and static); filters, systems and tools for monitoring and removing contaminants from fuel, air, oil, water and other liquids and gases; fluid connectors that control, transmit and contain fluid; hydraulic components and systems for builders and users of industrial and mobile machinery and equipment; and high quality flow control solutions.

Aerospace Systems (22.9%): This segment oversees product design and manufacturing and also provides after-sales support for a wide range of aerospace products, including commercial, business aircraft, military aircraft, and general aviation aircraft and missiles.

Products offered include control systems and components, fluid metering, delivery and atomization devices, fuel systems and components, pneumatic control components, hydraulic systems and components, and lubrication components and more.

The segment’s products and services are offered to OEMs and maintenance, repair and overhaul (MRO) customers worldwide. It should be noted that products are marketed by field sales staff and sold to manufacturers as well as end customers.

Bottom row

While anyone can invest, building a profitable investment portfolio requires research, patience and a little risk. If you invested in Parker-Hannifin ten years ago, you probably feel pretty good about your investment today.

According to our calculations, a $1,000 investment made in December 2013 would be worth $3,605.96, or a 260.60% return as of December 29, 2023. Investors should note that this return excludes dividends but includes price appreciation .

Compare that to the S&P 500’s rally of 159.77% and gold’s return of 64.92% over the same time frame.

Analysts expect more upside for PH.

Parker-Hannifin is benefiting from increased demand from distributors and end users in the oil and gas, materials handling, light and light truck, and agricultural and agricultural markets in the North American region within the diversified industrial segment. Higher volume across all businesses, particularly the commercial and military aftermarket businesses, boosted the company’s Aerospace Systems unit. Synergies from the Meggitt buyout (September 2022) also help the company. Win strategy benefits boost Parker-Hannifin’s margins. The company’s measures to add shareholder value are promising. However, rising cost of sales and rising SG&A costs threaten the bottom line. Foreign exchange headwinds could erode PH’s top line. The weak liquidity position is also a concern.

The stock has risen 6.64% over the past four weeks and no earnings estimates have fallen over the past two months, compared to 7 higher for fiscal 2023. The consensus estimate has also risen.

Want the latest recommendations from Zacks Investment Research? Today you can download 7 best stocks for the next 30 days. Click to get this free report

Parker-Hannifin Corporation (PH) : Free Stock Analysis Report

To read this article, click here.

Zacks Investment Research

Leave a Comment

Your email address will not be published. Required fields are marked *