Yahoo Finance Can Parker-Hannifin (PH) Run Higher on Rising Earnings Estimates?
Parker-Hannifin (PH) appears an attractive pick given a noticeable improvement in the company's earnings outlook. The stock has been a strong performer lately, and the momentum might continue with analysts still raising their earnings estimates for the company.
Analysts' growing optimism on the earnings prospects of this maker of motion and control products is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. This insight is at the core of our stock rating tool -- the Zacks Rank.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
Consensus earnings estimates for the next quarter and full year have moved considerably higher for Parker-Hannifin, as there has been strong agreement among the covering analysts in raising estimates.
Current-Quarter Estimate Revisions
The company is expected to earn $5.45 per share for the current quarter, which represents a year-over-year change of +5.62%.
The Zacks Consensus Estimate for Parker-Hannifin has increased 5.99% over the last 30 days, as five estimates have gone higher compared to no negative revisions.
Current-Year Estimate Revisions
For the full year, the company is expected to earn $20.46 per share, representing a year-over-year change of +9.29%.
There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, six estimates have moved up for Parker-Hannifin versus no negative revisions. This has pushed the consensus estimate 6.48% higher.
Favorable Zacks Rank
The promising estimate revisions have helped Parker-Hannifin earn a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Bottom Line
Parker-Hannifin shares have added 6.2% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.
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Parker-Hannifin Corporation (PH) : Free Stock Analysis Report
