PH Value Scorecard - Parker Hannifin

Value Scorecard · run 2026-10-18

13 value checks: 12 scored 1 to 5, plus moat evidence

47/60

moderate value score

Earnings & returns

EPS Trend

5/5

Diluted EPS: $10.09 (2022), $16.04 (2023), $21.84 (2024), $27.12 (2025). It rose every year; the framework scores that as 5.

ROE Trend

5/5

ROE (net income / common equity): 20.2% (2023), 23.6% (2024), 25.8% (2025), 23.7% (2026). Median 23.6%, lowest 20.2%; the framework scores a median above 20% as 5.

ROIC

5/5

ROIC of 20.5%: operating income of $5.07B divided by $24.78B of capital (total assets $30.88B minus current liabilities $6.10B), fiscal year to Jun 30, 2026, as filed in the 10-K (SEC EDGAR). The framework scores above 20% as 5.

Profit Margins

4/5

Net margin of 17.0%; the framework scores 10-20% as 4; gross margin 37.5%, operating margin 23.5%.

Balance sheet & cash

Debt-to-Equity

4/5

Debt-to-equity of 0.57; the framework scores 0.3-0.8 as 4 (total debt $8.73B, total cash $501.00M).

Free Cash Flow

5/5

Free cash flow (operating cash flow minus capital expenditure): $2.60B (2023), $2.98B (2024), $3.34B (2025), $3.90B (2026). It rose every year; the framework scores that as 5.

Retained Earnings

5/5

Retained earnings, as filed in the 10-Ks (SEC EDGAR): $17.04B (2023), $19.11B (2024), $21.77B (2025), $24.49B (2026). It rose every year; the framework scores that as 5.

Valuation models

Graham IV

4/5

IV = EPS x (8.5 + 2g) x (4.4 / Y) = $28.48 x (8.5 + 2 x 20.0) x (4.4 / 4.5) = $1,350.58 (EPS CAGR 30.0% capped at 20%). Current price $963.34; price is 28.7% below the model value.

DCF Value

1/5

FCF/share = $23.485, stage 1 growth = 3.9% for 5 years, terminal growth = 3%, discount rate = 10%. Stage 1 PV = $99.28, PV of terminal value = $259.80, DCF value = $359.08. Current price $963.34; price is 168.3% above the model value.

Margin of Safety

3/5

Graham value $1,350.58 (price is 28.7% below the model value); DCF value $359.08 (price is 168.3% above the model value).

Price-to-Book

1/5

P/B of 7.89; the framework scores above 5.0 as 1.

Business quality

Moat Evidence

Not scored

A moat (a brand, a network, switching costs, patents, scale, a licence) is not a number in the filings, so Valerius doesn’t score it. Below are the figures and the words moat analysis starts from, from the company’s own 10-K filings. The conclusion is yours.

Return on capital, each year

Above 15% in 6 of 10 years (2017-2026); lowest 11.7%, highest 20.5%.

Gross margin, each year

Between 23.6% and 37.7% over 10 years (a range of 14.1 points).

Competition, in the company’s own words · 10-K filed Aug 21, 2026

Parker operates in highly competitive markets and industries. We offer our products over numerous, varied markets through our divisions operating in 44 countries. Our global scope means that we have hundreds of competitors across our various markets and product offerings. Our competitors include U.S. and non-U.S. companies. These competitors and the degree of competition vary widely by product lines, end markets,

The opening of the company’s “Competition” section in its 10-K, quoted word for word, not summarized or edited. It is the company’s own description, not Valerius’s view, and may include the company’s expectations. Open the filing.

Return on capital = operating income / (total assets − current liabilities), the ROIC row’s definition; 15% is the framework’s return threshold. Gross margin = gross profit / revenue. Both from each year’s 10-K via SEC EDGAR. Moat analysis commonly looks at whether returns and margins held up over many years. These figures don’t say whether the company has an advantage, what it is, or whether it will last.

Capital Allocation

5/5

Capital allocation, 2023-2026: dividends or buybacks paid in every year (pass); $6.94B paid out against $12.83B of free cash flow (pass); total debt $12.56B to $8.52B, down 32.2%, 1.4x EBITDA (pass: not up more than 10%); shares outstanding 0.13B to 0.13B, down 1.8% (pass). 4 of 4 tests passed; the framework scores that as 5.

Filings

Company notices to the SEC

Not scored

Three kinds of event the company reported to the SEC in the last 5 years, from its filings on SEC EDGAR.

These are events the company reported to the SEC. An auditor change or a late filing can have many causes; each date links to the filing, where the company explains it. Valerius does not score these.

How the Graham and DCF values were calculated

  Graham Formula:
    IV = EPS x (8.5 + 2g) x (4.4 / Y)
    EPS = $28.48, g = 20.0%, Y = 4.5
    g capped at 20.0% (3-year EPS CAGR was 30.0%)
    IV = $1,350.58
    Current price $963.34 vs Graham value $1,350.58 — price is 28.7% below the model value.

  DCF:
    FCF/share = $23.485
    Stage 1 growth = 3.9% for 5 years | terminal growth = 3.0% | discount rate = 10.0%
      Y1: $24.401 → PV $22.183
      Y2: $25.353 → PV $20.953
      Y3: $26.341 → PV $19.791
      Y4: $27.369 → PV $18.693
      Y5: $28.436 → PV $17.657
    Stage 1 PV sum = $99.28
    Terminal value at end of Y5 = $418.42
    PV of terminal value = $259.80
    DCF value = $359.08
    Current price $963.34 vs DCF value $359.08 — price is 168.3% above the model value.

Data from yfinance summary figures and financial statements, and from the company’s 10-K filings via SEC EDGAR; computed at a price of $963.34. Every score is calculated from the figures by the framework’s fixed rules, and the explanation beside it is generated from the same figures: Graham value, DCF value, margin of safety, ROIC, profit margins, debt-to-equity, price-to-book, EPS trend, ROE trend, free cash flow, retained earnings and capital allocation. No AI is involved in this scorecard. The moat is shown as evidence, without a score. Read each score with the figures beside it. Intrinsic value calculations are model outputs based on stated assumptions, not predictions.

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