July 20, 2026 a 12:46 pm
PH: Dividend Analysis - Parker-Hannifin Corporation
The Parker-Hannifin Corporation exhibits a compelling dividend profile with a robust history of 42 years of uninterrupted dividend payments. With a current dividend yield of 0.84%, it reflects stability but also suggests room for yield improvement given its strong market position and growth potential. Investors should note the corporation's strategic focus on maintaining steady cash flows and a cautious payout ratio.
📊 Overview
Parker-Hannifin operates within the Industrial sector, showcasing a stable dividend history with a modest yield of 0.84%. The current dividend per share stands at USD 6.71, reflecting its commitment to shareholder returns. This reliability over 42 years with no recent cuts highlights its resilience and management's commitment to consistent dividend policy.
| Aspect | Details |
|---|---|
| Sector | Industrial |
| Dividend yield | 0.84% |
| Current dividend per share | USD 6.71 |
| Dividend history | 42 years |
| Last cut or suspension | None |
🗣️ Dividend History
Parker-Hannifin's track record of uninterrupted dividends for 42 years is a testament to its financial stability and commitment to shareholders. Historical consistency in dividends is crucial for income-focused investors as it indicates reliable income streams.
| Year | Dividend per Share (USD) |
|---|---|
| 2026 | 3.80 |
| 2025 | 7.03 |
| 2024 | 6.37 |
| 2023 | 5.77 |
| 2022 | 5.02 |
📈 Dividend Growth
Moderate growth in dividends reflects the company's ongoing efforts to enhance shareholder value. In the recent 3-year period, dividends grew by 11.88%, while the 5-year growth stands at 14.84%. This consistent increase signals promising prospects for future dividend hikes.
| Time | Growth |
|---|---|
| 3 years | 11.88% |
| 5 years | 14.84% |
The average dividend growth is 14.84% over 5 years. This shows moderate but steady dividend growth.
⚠️ Payout Ratio
Payout ratios are pivotal in evaluating a firm's capacity to sustain dividends. Parker-Hannifin's EPS-based payout ratio is 24.34%, and its free cash flow-based payout ratio is 23.00%. These figures suggest strategic balance and fiscal prudence in dividend disbursement, with ample room for maintaining dividend payouts.
| Key Figure | Ratio |
|---|---|
| EPS-based | 24.34% |
| Free cash flow-based | 23.00% |
The company's careful management is evident with a 24.34% EPS payout ratio and 23.00% cash flow coverage, indicating dividend sustainability without compromising growth investments.
🧾 Cashflow & Capital Efficiency
The efficacy of cash flow management is critical for growth and dividend stability. Parker-Hannifin maintains a free cash flow yield of 3.06%, which is complemented by a robust CAPEX to operating cash flow allocation. These indicators reflect strong cash-generating access and efficient capital deployment, essential for future dividend growth and repayment flexibility.
| Indicator | 2023 | 2024 | 2025 |
|---|---|---|---|
| Free Cash Flow Yield | 5.19% | 4.64% | 3.73% |
| Earnings Yield | 4.16% | 4.42% | 3.94% |
| CAPEX to Operating Cash Flow | 12.78% | 11.82% | 11.52% |
| Stock-based Compensation to Revenue | 0.75% | 0.78% | 0.80% |
| Free Cash Flow / Operating Cash Flow Ratio | 87.22% | 88.18% | 88.48% |
The data confirms Parker-Hannifin's strong operational efficiency supporting steady dividend payouts and future investment potential.
📊 Balance Sheet & Leverage Analysis
Parker-Hannifin's leverage metrics are pivotal for assessing financial risk. With a debt-to-equity ratio of 0.70, a net debt to EBITDA ratio of 1.62, and manageable current financial obligations, the company demonstrates performance leverage while maintaining liquidity, as evidenced by its quick ratio of 0.71 and satisfactory interest coverage.
| Indicator | 2023 | 2024 | 2025 |
|---|---|---|---|
| Debt-to-Equity | 1.26 | 0.91 | 0.70 |
| Debt-to-Assets | 43.33% | 37.46% | 32.68% |
| Debt-to-Capital | 55.70% | 47.62% | 41.33% |
| Net Debt to EBITDA | 3.07 | 2.10 | 1.69 |
| Current Ratio | 0.88 | 0.93 | 1.19 |
| Quick Ratio | 0.51 | 0.55 | 0.71 |
| Financial Leverage | 2.90 | 2.43 | 2.16 |
Stability is reinforced with a consistent reduction in leverage ratios over the years, signifying resilient balance sheet strength and effective debt management.
🔥 Fundamental Strength & Profitability
Profitability metrics such as return on equity (ROE) at 24.69% and net profit margins demonstrate Parker-Hannifin's financial health. These indicators are pivotal for evaluating the firm's capacity to generate profits relative to shareholders' equity and sales revenue.
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Return on Equity | 20.17% | 23.56% | 25.81% |
| Return on Assets | 6.95% | 9.71% | 11.97% |
| Net Margin | 10.93% | 14.27% | 17.79% |
| EBIT Margin | 17.07% | 20.58% | 22.75% |
| EBITDA Margin | 21.36% | 25.23% | 27.32% |
| Gross Margin | 33.88% | 35.91% | 36.85% |
| Research & Development to Revenue | 1.35% | 1.27% | 1.21% |
Parker-Hannifin boasts admirable profit margins and high asset returns, implying efficient operational management aligned with growth strategies.
📉 Price Development
✅ Dividend Scoring System
| Criteria | Score | Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 5 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow coverage | 4 | |
| Balance sheet quality | 4 |
Overall Score: 34/40
🏆 Rating
Given Parker-Hannifin's robust fiscal performance, stable dividend history, and efficient capital management, the corporation is a recommended consideration for dividend-focused portfolios. Its strategic approach to consistent dividend payouts and strong financial standing provides a sound investment premise.
Smart Data Insight
Master the Perfect Entry & Exit for this Stock
Don't leave your profits to chance. Historically, this stock follows specific seasonal patterns that institutional traders use to maximize returns.
- ✅ Identify the "Golden Buying Window"
- ✅ Avoid high-risk correction cycles
- ✅ Backtested data from the last 20+ years