Parker-Hannifin Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Parker-Hannifin (NYSE:PH) will unveil its latest earnings on Thursday, August 2, 2012. Parker Hannifin manufactures motion and control technologies and systems, including electromechanical controls, fluid power systems, and related components.

Parker-Hannifin Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.91 per share, a rise of 6.7% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.96. Between one and three months ago, the average estimate moved down. It also has dropped from $1.94 during the last month. Analysts are projecting profit to rise by 16% compared to last year’s $7.39.

Last quarter, the company came in at profit of $2.01 per share against a mean estimate of net income of $1.72 per share, beating estimates after missing them in the previous quarter. In the second quarter, it missed forecasts by 8 cents.

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A Look Back: In the third quarter, profit rose 11.6% to $312.1 million ($2.01 a share) from $279.6 million ($1.68 a share) the year earlier, exceeding analyst expectations. Revenue rose 4.7% to $3.39 billion from $3.24 billion.

Stock Price Performance: From June 28, 2012 to July 27, 2012, the stock price rose $8.30 (11.4%), from $73.10 to $81.40. The stock price saw one of its best stretches over the last year between March 6, 2012 and March 13, 2012, when shares rose for six straight days, increasing 4.9% (+$4.16) over that span. It saw one of its worst periods between December 9, 2011 and December 19, 2011 when shares fell for seven straight days, dropping 8.8% (-$7.15) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.81 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.91 in the second quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 17.4% to $2.49 billion while assets rose 11.2% to $4.5 billion.

Key Stats:

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 20.2% in the first quarter and 4.6% in the second quarter before increasing again in the third quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 22.4% in the fourth quarter of the last fiscal year, 14.3% in the first quarter and 8.4% in the second quarter before increasing again in the third quarter.

Analyst Ratings: With five analysts rating the stock as a buy, none rating it as a sell and five rating it as a hold, there are indications of a bullish outlook.

Wall St. Revenue Expectations: Analysts are projecting a rise of 0.3% in revenue from the year-earlier quarter to $3.42 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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