PH

Parker-Hannifin stock comes into focus after a powerful five year run, while current checks suggest the shares now trade close to an intrinsic value estimate rather than at a clear discount. The stock has returned about 276% over five years, which puts extra attention on whether today’s price already reflects much of that success. The completed acquisition of Filtration Group Corporation can support expectations for stronger cash generation over time, while any shortfall on integration benefits or cost synergies may weigh on what investors are willing to pay for that growth. Parker-Hannifin screens as not a clear bargain on broader valuation checks, with 0 of 6 value tests pointing to the stock as outright cheap. The issue now is whether Parker-Hannifin’s current share price already reflects a fair intrinsic value, or if there is still room for upside based on cash flow and earnings power. Compare Parker-Hannifin’s powerful five year run and fair-value signals with other potential industrial standouts by scanning the hand picked 38 power grid technology and infrastructure stocks, which is aligned with major infrastructure spending themes. The Discounted Cash Flow model values Parker-Hannifin by projecting future free cash flows and discounting them back to today. On this view, Parker-Hannifin’s latest twelve month free cash flow of about $3.9b is treated as growing over time, which feeds into an estimated intrinsic value of about $972 per share. This is close to the current share price, with the DCF indicating the stock trades about 6.9% above that intrinsic estimate, so it screens as slightly overvalued rather than clearly cheap or expensive. The completed Filtration Group Corporation acquisition is incorporated into these higher cash flow expectations, yet the current premium suggests investors already ascribe meaningful credit for future integration benefits. Overall, the DCF workup points to Parker-Hannifin stock trading around a level that looks roughly fairly valued with only a small tilt toward overvalued. Parker-Hannifin is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment's notice. Track the value in your watchlist or portfolio and be alerted on when to act. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Parker-Hannifin. P/E is a useful cross check for Parker-Hannifin because earnings remain a key anchor for how investors think about established industrial stocks. On this measure, Parker-Hannifin trades on a P/E of about 35.9x, which is higher than both the Machinery industry average of roughly 26.5x and a peer group average of about 25.1x. The fair P/E ratio for Parker-Hannifin is estimated at about 32.8x, based on factors such as its growth profile, margins, size and risk. That sits below the current multiple, so the shares screen at a premium to what this framework suggests would be a neutral level, although not at an extreme stretch. The gap indicates investors are willing to pay something extra for Parker-Hannifin’s earnings, yet the difference from the fair ratio is moderate rather than dramatic. On the P/E multiple, Parker-Hannifin stock looks roughly fairly valued with only a modest premium to what the model treats as a fair level. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives for Parker-Hannifin pick up where the valuation work leaves off by explaining what combination of future growth, margins and earnings would need to occur for the stock to be worth materially more or less than today’s price, on the Community page. Where a ratio or model presents a single figure, these Narratives unpack the future behind it so you can track whether those assumptions still hold over time. The Parker-Hannifin community splits into two clear camps that see the same data but read the story very differently. Bull case: 23% undervalued Read the full Bull Case to see why Parker-Hannifin could be undervalued Bear case: 20% overvalued Read the full Bear Case to see why Parker-Hannifin could be overvalued Do you think there's more to the story for Parker-Hannifin? Head over to our Community to see what others are saying! Parker-Hannifin now screens as roughly fairly valued. The Discounted Cash Flow (DCF) intrinsic value estimate sits slightly below the current share price, and the P/E multiple also points to only a modest premium rather than a clear bargain. Broader valuation checks are weak, which keeps expectations in check despite the stock trading only a little above intrinsic value and the tailored multiple. The key question from here is whether Parker-Hannifin can deliver the cash flow, margins and earnings profile that would justify investors continuing to pay this kind of premium without fresh valuation support. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include PH. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

The rally that moved the stock leaned on two of three segments; the backlog behind it grew without anyone waiting longer. Nordson (NDSN) closed Thursday at $334.70, an 8.0% gain in a single session and a 52-week high, while the S&P 500 fell 0.8% and peers Graco (GGG), Illinois Tool Works (ITW) and Parker Hannifin (PH) all finished lower. The move followed record fiscal Q3 2026 results and a raised full-year outlook. The quarter explains the direction; the order book explains the size. The Raise Is Not Evenly Owned Across The Three Segments Sales of $818 million were a quarterly record, up 10% year over year in total and 12% organically, and adjusted earnings per share cleared the high end of the company's own third-quarter guidance by ten cents. The full-year adjusted earnings guide was raised to $11.80 to $12 per diluted share. Organic sales grew 31% at Advanced Technology Solutions and about 11% at Medical and Fluid Solutions, against 3% at Industrial Precision Solutions, which management calls half the company. By management's account, the upside came from Advanced Technology Solutions and the medical business, while Industrial Precision Solutions ran as expected at the 3% that is its long-term goal. That is a narrow base for a move this size. Why That Backlog Is Orders Rather Than A Queue Backlog left the quarter up 35% from a year earlier, and a number that size normally deserves suspicion: backlog also swells when a company cannot ship, and the queue then reads as demand. Management's account is the opposite: lead times have come down rather than stretched, and roughly 80% of the backlog still turns within about six months. A book that mostly clears in half a year and is a third larger is intake, not congestion. Advanced Technology's growth, meanwhile, runs through two product lines, Electronics Dispense and Test and Inspection, whose X-ray and optical technologies management calls critical to semiconductor packaging. Much of that demand sits in Asia today, and by management's account the North American chip manufacturing buildout has produced no Nordson orders yet. What Is Left When The Systems Orders Stop About 60% of what the company sells generates recurring revenue, including aftermarket parts, consumables and services, and that revenue keeps earning when systems orders pause. Free cash flow was $237 million in the quarter, the fifth consecutive quarter of converting well over 100% of net income. Cash generation of that kind is one of the things the Trefis High Quality Portfolio looks for in its holdings. Management Named The Peak While The Market Bid The Stock Higher Advanced Technology sits at the peak of its cycle by management's own description, and fiscal 2027 growth there is expected to build off that peak at a mid-single-digit rate. The same account holds that the cycle still has room, with demand strong heading into fiscal 2027. The two reconcile as a rate against a level: the growth rate steps down from here, the record base it steps down from does not, and North American orders are still outside the numbers entirely. Whether the guide keeps moving up is the thing to watch, and a screen built on guidance revisions is where that shows across the market. Enjoy The Move, Then Check What It Did To Your Allocation A move like this is even better to own than to watch, and it is also how one holding grows into an outsized share of a portfolio. A position that has grown large enough to matter is worth sizing deliberately rather than by accident. What a position that size would do to your net worth is exactly what the Trefis Wealth team computes, with the same rules-based systematic discipline that runs our High Quality Portfolio. Request a free vulnerability audit of your biggest positions.

Parker-Hannifin’s second quarter was characterized by broad-based strength across its business segments, leading to positive market reaction. Management attributed the quarter’s performance to strong organic revenue growth, notable momentum in its aerospace business, and expansion in both North American and international markets. CEO Jennifer Parmentier highlighted that electronics and in-plant demand fueled international results, while heavy-duty truck and infrastructure spending supported North America. The company also benefited from operational discipline, achieving record margins and significant growth in backlog. Is now the time to buy PH? Find out in our full research report (it’s free). Revenue: $5.76 billion vs analyst estimates of $5.57 billion (9.8% year-on-year growth, 3.3% beat) Adjusted EPS: $9.27 vs analyst estimates of $8.27 (12.2% beat) Adjusted EPS guidance for the upcoming financial year 2027 is $34.75 at the midpoint, beating analyst estimates by 1.9% Operating Margin: 23.9%, up from 21.3% in the same quarter last year Organic Revenue rose 8% year on year (beat) Market Capitalization: $134.9 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Scott Davis (Melius Research) asked about the remaining hurdles for closing Filtration Group and CIRCOR acquisitions. CEO Jennifer Parmentier confirmed no major issues remain and expects closure in the second half of the year, with integration plans ready. Jeffrey Sprague (Vertical Research) pressed for details on the drivers behind strong international order growth. Parmentier highlighted electronics and in-plant as catalysts, especially in Asia Pacific, and clarified the move to rolling 12-month order reporting for better organic growth correlation. Christopher Snyder (Morgan Stanley) inquired about which industrial verticals show the most promise. Parmentier pointed to sustained aerospace and electronics momentum, gradual improvement in in-plant demand, and strong orders for heavy-duty trucks and construction. Amit Mehrotra (UBS) questioned the nature of distribution channel recovery in North America. Parmentier responded that while distributors are positive and some are restocking for specific projects, a full-channel restock has not yet occurred and current growth is volume-driven. Nathan Jones (Stifel) asked if recent international order strength could improve the second half outlook. Parmentier replied that guidance reflects current order progression, with the potential for upward revisions if momentum persists. Key milestones our analyst team will be tracking include (1) the pace of integration and realized synergies from the Filtration Group and CIRCOR acquisitions, (2) sustained order growth in electronics, aerospace, and distribution channels, and (3) execution on Parker-Hannifin’s new 30% segment operating margin target. Progress in data center solutions and operational enhancements will also be important indicators. Parker-Hannifin currently trades at $1,068, up from $996.90 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Dividend Kings have earned their reputation by raising their payouts for at least 50 consecutive years, an accomplishment that requires navigating recessions, inflationary periods, rising interest rates, and numerous market cycles without breaking their streaks. Still, an exceptional dividend history doesn't automatically make a stock a buy at any given price. Earnings growth, valuation, and the direction of analyst estimates remain important considerations, particularly after quarterly results give Wall Street a fresh look at a business. Four Dividend Kings — Becton, Dickinson and Company BDX), Consolidated Edison ED), Emerson Electric EMR), and Parker-Hannifin PH) — reported earnings last week. Medical technology giant Becton, Dickinson and Company delivered better-than-expected results for its fiscal third quarter, with adjusted earnings of $3.23 per share topping estimates of $3.14 despite dipping from Q3 EPS of $3.68 a year ago following the separation of its Biosciences and Diagnostic Solutions operations. Revenue reached roughly $5 billion, down 9% from the prior-year period but topping expectations of $4.89 billion. That said, growth from its continuing businesses was broad-based. Medical Essentials revenue increased 4%, Connected Care rose 5%, BioPharma Systems advanced 6%, and BD Interventional climbed 6% on a reported basis. Cash generation was another bright spot, with year-to-date cash flow from continuing operations increasing by 33% to $2.1 billion and free cash flow increased over 44% to $1.7 billion. Management also tightened its fiscal 2026 adjusted EPS outlook to $12.62-$12.72, compared with its previous $12.52-$12.72 range, effectively raising the midpoint. The updated EPS range calls for 6-7% growth for the continuing business, although FY25 EPS came in at $14.40 last year before the separation of its Biosciences and Diagnostics operations. When accounting for the spin-off, full-year revenue growth is expected at low single digits from a continuing revenue base of $18.54 billion last year. The quarter wasn't flawless as gross and operating margins faced pressure while BD works through a significant portfolio transformation. Verdict: For investors, the appeal centers on a durable medical-technology franchise, improving cash generation and a long record of dividend growth. Yet a Zacks Rank #3 (Hold) suggests analysts' earnings revisions aren't currently strong enough to signal a more aggressive entry point, even with BDX shares having the cheapest forward P/E multiple on the list at 14X. Consolidated Edison provided the defensive flavor investors typically expect from a Dividend King while also delivering a sizable earnings beat. Second-quarter adjusted earnings came in at 83 cents per share, comfortably ahead of expectations of $0.74 and up from Q2 EPS of $0.67 a year earlier. Revenue increased 13% to $4.06 billion and easily topped Q2 estimates of $3.74 billion by 8%. The growth was supported by higher electric and gas rate bases, with Con Edison’s operating income surging 55% YoY to $552 million. Electric revenue rose 13% to $3.14 billion, gas revenue advanced 14% to $811 million, and steam revenue increased 11% to $118 million. Those gains helped offset higher purchased-power and fuel costs. Looking ahead, Con Edison reaffirmed its FY26 adjusted EPS guidance of $6.00-$6.20 (+5% growth). The utility provider also has an enormous investment program ahead, with nearly $38 billion in planned capital expenditures from 2026 through 2030. That spending should support rate-base growth over time, but utilities generally lack the explosive earnings potential found in more economically sensitive industrial businesses. Interest rates and valuation can also have an outsized influence on utility stocks because income-oriented investors frequently compare their yields with fixed-income alternatives. Verdict: ED remains attractive for investors prioritizing dividend reliability and defensive exposure, and its latest earnings beat reinforces the stability of Con Edison’s underlying business. However, the current Zacks Rank #3 (Hold) suggests the near-term earnings outlook is balanced rather than signaling a particularly compelling buying opportunity, even with ED shares trading at a very reasonable 17X foward earnings multiple. Among these four Dividend Kings, Emerson Electric produced one of the more impressive combinations of growth, margin expansion, and improving guidance. Reporting results for its fiscal third quarter, Emerson’s Q3 adjusted EPS increased over 12% to $1.71 and edged expectations of $1.68, while revenue climbed 7% YoY to $4.87 billion and topped estimates of $4.79 billion. Underlying sales advanced 6%, and underlying orders rose 7%, pointing to healthy demand across the automation specialist's portfolio. Software & Systems was particularly strong, posting an 11% sales increase, while Test & Measurement sales jumped 23%. Emerson also benefited from demand across power, aerospace and defense, liquefied natural gas and other longer-cycle markets. Backlog excluding its Aspen Tech asset manager software business increased 7% to $8.2 billion. Profitability added another positive element. Adjusted segment EBITA margin expanded 140 basis points to 28.5%, while Q3 operating cash flow jumped 34% and free cash flow rose 36%. Those results prompted management to raise its fiscal 2026 outlook. Net sales are now projected to grow approximately 5%, which would equate to around $19 billion, with underlying sales growth of around 3.5%. Full-year adjusted EPS is expected to be around $6.55 (9% growth), and Emerson anticipates generating approximately $3.6 billion in free cash flow. Roughly $2.2 billion is slated to be returned to shareholders through about $1 billion of repurchases and $1.2 billion of dividends. Verdict: Hold with a Bullish lean. While EMR currently lands a Zacks Rank #3 (Hold) as well, Emerson's operating trends look stronger, and it wouldn’t be surprising if a buy rating is on the way if analysts start to raise their earnings estimates in accordance with the company’s raised guidance. Rising orders, expanding margins, and increased guidance make EMR worth watching closely at a reasonable 25X forward P/E, particularly if upward earnings estimate revisions strengthen enough to support a higher Zacks Rank. As a global diversified manufacturer of motion and control technologies and systems, Parker-Hannifin arguably posted the strongest headline numbers of the four. PH’s fiscal fourth-quarter adjusted earnings surged 20% to $9.27 per share, easily topping EPS expectations of $8.29 by nearly 12%. Revenue increased roughly 10% to $5.75 billion, exceeding estimates of $5.6 billion, with organic sales growing 8%. Perhaps even more encouraging for future demand, was that orders soared 19% YoY. Strength came from both major operating businesses. Diversified Industrial sales increased 8%, while Aerospace Systems benefited from robust demand. For the full fiscal year, PH’s adjusted earnings advanced over 18% to $32.31 per share, and annual sales increased more than 8% to $21.5 billion. The company's profitability remains another major strength. Adjusted total segment operating income increased over 14%, and the corresponding margin expanded 110 basis points to 28%. Cash generation was also robust, with FY26 operating cash flow reaching $4.36 billion. It’s also worth noting that PH’s long-term debt fell to $6.77 billion from $7.49 billion a year earlier. For FY27, management expects both net sales and organic sales growth to be between 5.5%-8.5%, an adjusted segment operating margin of 27.5%-27.9%, and adjusted EPS of $34.25-$35.25 (+6% growth). Importantly, that guidance excludes the pending Filtration Group and CIRCOR Commercial and Defense Aerospace acquisitions. Verdict: Hold, with a bullish lean. PH's earnings beat, 19% order growth, and impressive margins make its fundamental story difficult to ignore. The primary question isn't the quality of the business but whether its current P/E valuation of 30X and earnings revisions provide enough upside to justify chasing shares immediately after their run, with PH stock spiking 8% this month. BDX, ED, EMR and PH stock have something very few publicly traded businesses can claim: dividend-growth records stretching across half a century or more. Their latest earnings reports also show that these mature businesses aren't relying solely on their dividend histories to attract investors. Becton Dickinson delivered broad-based revenue growth and stronger cash generation while lifting the midpoint of its earnings outlook. Consolidated Edison topped expectations and has a massive capital-investment program supporting its long-term rate base. Emerson Electric paired higher orders with margin expansion and raised guidance. Parker-Hannifin, meanwhile, produced double-digit earnings growth, a sharp increase in orders and another year of strong cash generation. The catch is that great businesses don't always equal great entry points for stocks. With all four stocks currently carrying a Zacks Rank #3 (Hold), the near-term earnings revision picture doesn't provide a clear enough catalyst to warrant an outright Buy rating and the plausibility of significant short-term upside. That doesn't make these Dividend Kings stocks to sell, either. Their durable businesses, shareholder-friendly capital allocation and decades-long dividend records make them compelling names to keep on investors' watchlists. For now, holding existing positions may be the most appropriate approach, while prospective buyers can watch for more favorable valuations or stronger upward earnings estimate revisions. Among the four, Emerson and Parker-Hannifin appear particularly intriguing following their strong operating results, and either could become more attractive should analyst revisions turn increasingly positive. 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 Emerson Electric Co. (EMR) : Free Stock Analysis Report Becton, Dickinson and Company (BDX) : Free Stock Analysis Report Parker-Hannifin Corporation (PH) : Free Stock Analysis Report Consolidated Edison Inc (ED) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 11:00 a.m. ET Chief Financial Officer - Todd Leombruno Chairman and Chief Executive Officer - Jennifer Parmentier Operator: Good morning, everyone. Welcome to Parker-Hannifin Corporation's Fiscal 2026 Fourth Quarter and Full Year Earnings Conference Call and webcast. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to turn the call over to Mr. Todd Leombruno, Chief Financial Officer. Please go ahead, sir. Todd Leombruno: Thank you, Bo. I'd like to welcome everyone to Parker's Fiscal Year 2026 Fourth Quarter and Full Year Earnings Release Webcast. As Bo said, this is Todd Leombruno, Chief Financial Officer speaking. And with me today, as usual, is Jenny Parmentier, our Chairman and Chief Executive Officer. We have a number of exciting things to review with everyone today, and we appreciate your time this morning. Thanks for joining us. Let's move to Slide 2 to address our disclosures on forward-looking projections and non-GAAP financial measures. Items listed here could cause actual results to vary from our forecast. Our press release, the presentation here and reconciliations for all those non-GAAP measures were released this morning and are available under the Investors section on parker.com. Today, Jenny is going to start with our record FY '26 performance. She's going to share some highlights on what we did with capital deployment actions this year and introduce our new FY '31 adjusted segment operating margin target. She's also going to address an upcoming change to our order rate reporting that will start in FY '27. I'm going to follow with some details on our record fourth quarter financial results. We also initiated our FY '27 guidance today, and we will review all the assumptions for what we expect to be a new record year for Parker Hannifin. We'll conclude the call with our normal Q&A portion, and we'll try to address as many questions as we have time for. Now let's move to Slide 3. And, Jenny, I will turn it over to you. Jennifer Parmentier: Thank you, Todd, and thank you to everyone for attending the call today. Our global teams delivered record performance in fiscal year '26, powered by our proven business system, The Win Strategy. We achieved top quartile safety performance with a 9% reduction in our recordable incident rate. This was our safest year ever, and we remain focused on being the safest industrial company in the world. We delivered record fiscal year '26 sales of $21.5 billion, surpassing $20 billion for the first time in Parker's history. Organic growth accelerated to 6.6% and adjusted segment operating margin expanded 120 basis points to a record 27.3%. Adjusted earnings per share increased 18% to a record $32.31, and cash flow from operations was also a record at $4.4 billion, our first time over $4 billion. I'd like to congratulate our team members around the world for achieving and surpassing our fiscal year '29 adjusted segment operating margin target ahead of schedule. Thank you for everything you do to keep each other safe, create value for customers and demonstrate operational excellence. Slide 4, please. Fiscal year '26 marks the biggest year in Parker's history with over $15 billion in announced and deployed capital. We announced strategic acquisitions that further build our portfolio of interconnected technologies, giving our application engineers and channel partners more ways to create value for customers. We enhanced our electrification capabilities with the acquisition of Curtis Instruments completed last September. In November, we announced the pending acquisition of Filtration Group Corporation, which expands our offering of proprietary filtration technologies and increases our filtration aftermarket by 500 basis points. And just this past May, we announced the pending acquisition of CIRCOR's commercial aerospace and defense business, adding complementary flight-critical capabilities. We are committed to actively deploying capital, and these transactions are right in line with our stated strategy to acquire companies where we are the clear best owner, building on our interconnected technology, creating value for customers and further compounding earnings growth. We look forward to welcoming our new team members into Parker. Moving to Slide 5. After setting our fiscal year '29 targets just over 2 years ago, we are raising the bar once again and setting a new margin target. As I said earlier, we achieved our fiscal year '29 margin target early. And now for the fifth time in just over 10 years, we are raising our adjusted segment operating margin target once again. We are raising it by 300 basis points to 30% by fiscal year '31. In addition, we remain committed to organic growth of 4% to 6% over the cycle, 17% free cash flow margin and greater than 10% adjusted EPS growth over the cycle. We are very proud of what the teams have accomplished over the last several years, and we are confident in achieving these targets. Parker has a fantastic track record of achieving and raising margin targets. Margin expansion has been an exciting part of the Parker story for over a decade. And by using The Win Strategy to drive operational excellence in each of our divisions, margin expansion will continue at Parker Hannifin. Slide 6, please. Today, we are announcing a move to rolling 12-month order rates beginning in fiscal year '27 for our Industrial segment, aligning all businesses on a rolling 12-month calculation. Parker's portfolio is profoundly different today than it was 20 years ago when we began disclosing quarterly order rate comparisons for the Industrial business. Our portfolio has been shaped by strategic positioning, one of our organic growth enablers, and has been transformed by acquisitions. Over the last decade, these acquisitions have more than doubled the size of our Aerospace and Engineered Materials businesses. And when Filtration Group Corporation closes, we will have more than tripled the size of our filtration business. These technology platforms combined now represent approximately 65% of our pro forma sales today. This is clearly a different Parker with greater exposure to longer-cycle secular trends and more resilient end markets, and rolling 12-month orders provide a stronger correlation to near-term organic sales growth. I'll give it back to Todd to review fourth quarter highlights. Todd Leombruno: Well, thank you, Jenny. I'm going to jump through the fourth quarter. We couldn't have had such a great fiscal year without such a strong finish in the fourth quarter. It was record-setting numbers across the board. The team delivered new records for sales, adjusted segment operating margin, adjusted EBITDA margin, net income and adjusted EPS, all in the quarter. Sales were up 10% versus prior. Organic was up 8%. That was the strongest quarter of the fiscal year when it comes to organic growth, really finished the year strong. Currency was just slightly unfavorable at 0.3% and the Curtis acquisition added 1.5% to the sales. When you look at margins, adjusted segment operating margin for the quarter was 28.0%. That is up 110 basis points from prior year. That's the first time the company has ever generated segment operating margins above 28% -- just a great way to finish the year. Adjusted EBITDA margin was 28.6%. That's up 180 basis points, and adjusted net income was $1.2 billion, which is a 21% return on sales. And that actually drove earnings per share up also 21%, and we achieved $9.27 for the quarter. That's the first time the company has ever generated over $9 in a single quarter. Just an outstanding way to finish the year, 8% organic growth, record margins across the board and 21% EPS growth. Jenny said this already, but really, we can't thank our teams enough for their continued hard work and dedication throughout the quarter and really finishing the year strong. If we jump to Slide 9, this just displays the walk, the $1.58 increase in EPS versus prior year. Really, you could just see what a high-quality quarter this was from the team. Over 80% of the EPS growth came from increased segment operating income dollars. That added $1.29 or 17% of the EPS growth versus prior year. Corporate G&A and other, really, it's other contributed $0.25, and that was really the result of foreign currency exchange being favorable. Lower share count, we've done a significant amount of share buybacks over the last year that added $0.09 to the quarter and lower interest expense added $0.02. Income tax was favorable to our guide, but compared to last year, it was unfavorable by just $0.07, and that was really due to just higher discrete -- favorable discrete items in the prior year. You look at all of that, that's how we got to $9.27, $9.27 of adjusted EPS, just a great way to end the year. If we could go to Slide 10, let's take a look at the segments. In total, I already mentioned this, but organic growth was up 8%. We expanded margins across the board, 110 basis points in the quarter and incrementals were 40% for Q4. We are very pleased to see the order rates accelerate across all these businesses. Jenny just mentioned this, but beginning in FY '27, we will convert to order reporting for all businesses using a 12-month rolling. I've provided the 3-month and the 12-month here, but this will be the last quarter we do this going forward for FY '27. In the appendix of this deck and in our press release, we provided eight quarters of historical comparisons, if you're interested in that. But in total, orders were up 19% on the 3-year comparison. Using the 12-month rolling, it was 12%. Backlog increased 16% versus prior year and is now a new record at $12.8 billion. If we move to the North American businesses, sales were $2.2 billion. Organic growth was just about 5%. Really, this is just based on a broadening recovery across all those businesses. Margins are up 70 basis points to a record 27.4%. That also exceeded our expectations and really marked the highest quarter of margin performance for the North American businesses of the year. Orders in North America improved to plus 16% on a 3-month comparison and 9% on a rolling 12. Just a great way to finish the year for the North American businesses. Moving to the international businesses. Sales were a record $1.6 billion. Organic growth, really impressive at 6.5%. Asia Pac really leading the way for us there. Organic growth in Asia Pacific was 16%. EMEA was positive, but just 1% positive. And Latin America was down 3% versus the prior year. What's great here is adjusted operating margin is a new record at 26.8% for the international businesses. That is up 210 basis points versus prior year and orders amazingly strong here, 24% on a 3-month comparison, 10% on a rolling 12. Just a nice way to finish the year for our industrial team members based in our international businesses. Aerospace continues to lead the way here, a record $1.9 billion in sales for the quarter, organic growth of 13.4% versus the prior year. This marks the fourth year, the fourth full fiscal year in a row of double-digit organic growth for Aerospace. The team has really outperformed and executed unbelievably well, generated $1.9 billion in sales. Margins are also up in Aerospace, up 80 basis points versus the prior year and reached 29.8% for the quarter. If you move to orders in Aerospace, order rates, unbelievably strong here, again, 18%, double-digit growth in both commercial OEM and aftermarket and really strength in the defense OEM markets. Backlog in aerospace is up 15% versus prior year and reached a record $8.5 billion. Just a great series of results from the team. If we can go to Slide 11, this highlights our cash flow performance, and we detailed some of those capital deployment actions that Jenny mentioned. Cash flow from operations surpassed $4 billion for the first time ever in the history of the company, really blew it away at $4.4 billion. That's 20.3% of sales. That is up 16% versus the prior year. Free cash flow increased by 17% versus prior year and also came in at a record at $3.9 billion. That's 18.2% of sales, and the conversion on that is 107%. In addition to delivering a record year of cash generation, we reached new highs when it comes to deploying capital. We returned nearly $2 billion to shareholders. That is $1 billion in share repurchases and nearly $1 billion of dividends paid. We invested $500 million of CapEx into our operations to make them safer and more productive. We completed the $1 billion acquisition of Curtis Instruments. And as Jenny said, we announced nearly $12 billion for the acquisitions of Filtration Group Corporation and CIRCOR's aerospace and defense business. In total, that's nearly $15 billion of capital deployment actions for the year, really underpinning our commitments to be great generators and great deployers of cash. And even with all those actions, we still reduced debt by $1 billion in the quarter, bringing our net debt to adjusted EBITDA to 1.4x. That is down from 1.7x at this time last year. Just a great year of cash generation. Okay. Now let's move to Slide 13 and address our FY '27 guidance. Jenny, I'm going to hand it back to you, and she will start with our sales growth forecast by market vertical. Jennifer Parmentier: Thank you, Todd. I'm on Slide 13. Our fiscal year '27 organic growth forecast by key market verticals. For aerospace and defense, our largest vertical, we are guiding high single-digit organic growth. We expect another year of robust double-digit growth for commercial OEM and sustained commercial aftermarket growth. Defense orders finished strong, supporting a solid outlook for fiscal year '27 and beyond. We expect mid-single-digit growth for in-plant and industrial. We see signs from distribution that the industrial recovery is broadening as customers' demand gradually accelerates. Customer spending on automation continues to lead the growth here. For our transportation vertical, we forecast mid-single-digit growth, led by strong growth for heavy-duty trucks driven by production rate increases. This is offset by lower growth assumptions for our automotive business, resulting in mid-single-digit growth overall for this vertical. Moving to off-highway. We are guiding mid-single-digit growth driven by a continuation of the trends we saw in fiscal year '26. We see continued strong growth in construction and mining, offset by continued softness in agriculture. We also expect mid-single-digit growth for energy. We see strong and sustained long-cycle growth from our businesses supporting gas turbine power generation, while we are expecting oil and gas to be flat this year. Lastly, we are guiding mid-single-digit growth in HVAC and refrigeration. We expect commercial HVAC to lead growth, and we see our residential business improving as inventories stabilize. For the first time ever, we are guiding positive sales growth across all market verticals, resulting in an organic growth forecast of 7% at the midpoint. I'll give it back to Todd, and he'll share more details on our guidance. Todd Leombruno: Thank you, Jenny. I'm on Slide 14, and I'm just going to go through some of the details here. Reported sales growth for the year is going to be in the range of 5.5% to 8.5% or 7% at the midpoint. That will calculate to approximately $23 billion in annual sales for the company. Sales are modeled as usual, 48% in the first half, 52% in the second half. Consistent with what we've done historically, this guidance does not yet include any impact from the pending Filtration Group or CIRCOR acquisitions. We will provide current data on those transactions as soon as they close. When you look at organic growth, the range is the same, 5.5% to 8.5% or 7% at the midpoint. Specifically for the North American businesses, we're expecting 6.5% organic growth at the midpoint. And for the international industrial businesses, we expect 5.5% organic growth at the midpoint. Aerospace, we expect 8.5% organic growth at the midpoint. And again, that's coming off of four years of double-digit organic growth. So the base is very high. Currency is based on our June 30 spot rates and is expected to be just slightly unfavorable by 0.5 point. And previously completed acquisitions, this is really Curtis, adds approximately 0.5% for the year of FY '27. On adjusted segment operating margins, we're guiding 27.7% at the midpoint. That's 40 basis points above prior year, and there will be margin expansion across all of our businesses. And when it comes to incrementals, we're forecasting that near the top end of our stated 30% to 35% range for the full year. Just a few additional guidance items. Corporate G&A is expected to be about $200 million. Interest expense is about $340 million. That, again, excludes any pending debt we take on when Filtration Group and CIRCOR close. And other expense is forecasted to be around $100 million. Tax rate, the full-year tax rate, we are guiding to 22.5%. EPS, full-year adjusted EPS is going to be $34.75 at the midpoint. That's an increase of 8% versus prior year. The range on that is plus or minus $0.50 on either side. The split on EPS is 47% first half, 53% in the second half. And for cash flow, we're expecting a range of $3.4 billion to $3.9 billion. That is free cash flow with conversion of approximately 100%. Now on the right-hand side of the page, just some details for the first quarter of FY '27, and all of these are at the midpoint. Reported sales are forecasted to be positive approximately 9%. Organic growth is expected to be positive at approximately 8%. For the quarter, we're forecasting adjusted segment operating margins at 27.7% and adjusted EPS is expected to be just over -- a little over $8 at $8.07 for the quarter. As usual, there are lots of additional guidance details in the appendix. On Slide 15, if you look at the bridge, this just shows the growth versus prior year. We're forecasting an increase of 8.5% in segment operating income dollars. That is a little over $3 of additional EPS for the year. Lower interest rate resulting from what we've been able to pay down in the year adds about $0.38. Lower share count will add $0.07. We've got a little bit of a headwind here on tax that's using a forecasted rate of 22.5%. That does not include any discrete items that are not yet known. And it is a bit of a headwind from what we've experienced in FY '26. Nothing unusual there, just still unknown. Corporate G&A and other, it's really other is forecasted to be unfavorable $0.14. All of that will be in the other line, and that's really due to the non-repeat of some favorable foreign currency exchange that we experienced in FY '26. In summary, the adjusted EPS is $34.75. That's up 8%. And with that, Jenny, I will hand it back to you. Jennifer Parmentier: Thanks, Todd. On our final slide, a reminder of what drives Parker. Safety, engagement and ownership are the foundation of our culture. It is our team members living up to our purpose every day that drives top quartile performance and allows us to be great generators and deployers of cash. Todd Leombruno: Okay, we are ready to start the Q&A portion of the call. Operator: [Operator Instructions] We'll go first today to Scott Davis with Melius Research. Scott Davis: Congrats on a great year. It must sound like a broken record because you've had quite a few of them in the last few years anyways. But -- just a cleanup item here. What are the final hurdles left to close the Filtration Group and CIRCOR? Any major hurdles? Jennifer Parmentier: No major hurdles. We still anticipate closing both of them during the second half of this calendar year, the first half of our fiscal year. As you know, closing remains subject to all the customary conditions pending regulatory clearances. But the process is ongoing and continuing to progress on both of them. Scott Davis: Okay. Fair enough. And then just as a follow-up, when you look at your targets, your new targets on Slide 5. And can you give us a sense of maybe where you're most comfortable and least comfortable if that's such a thing? I'm sure there's some minimum level of comfort, but just love to get a sense of where you feel are going to be the easier targets to hit versus the harder targets to hit. Todd Leombruno: Scott, I'll start with that and I'll let Jenny jump in here. None of these targets are easy by any stretch of imagination. But what gives me great confidence is the way our team embraces them. I've told you this many times before, I've never seen such alignment across the company. These are not easy to achieve by any stretch of imagination. I look at our track record, and we are just so proud of what we've been able to accomplish here. Raising that margin target to 30%, that's a big number, right? That is a big number. It's a 300 basis point improvement. But if you look at what we've done in the past, I have great confidence that we're going to be able to achieve that. We've done a great job on the EPS CAGR if you can get margin expansion and top line growth, sprinkling a little bit of accretive capital allocation, that works as well. So I feel really good about this. I don't really have any concerns. Jennifer Parmentier: No. I mean, I echo Todd's comments. The Win Strategy has never been stronger, and the alignment has never been stronger. Obviously, in these targets, we've included the acquisitions that we've yet to close. We're going to use our integration playbooks and do a great job as we have done in the past, and the team is going to continue to do what we've been doing. Operator: We'll go next now to Jeff Sprague with Vertical Research. Jeffrey Sprague: So where to start? Embarrassment of riches here. I guess the first thing is just on the strength of the orders on the rolling 3 basis here in the quarter, particularly in international. But can you just provide a little bit more color on what was going on there? Was there something that proved to be a real catalyst in a couple of key end markets? Jennifer Parmentier: Yes. I would tell you, for international, Jeff, it was really a nice driven by electronics. I mean there was really -- it was 24% with the 3/12 method. And last year, it was 0. So it was an easy comp of 0. But it was really driven by electronics and in-plant, double-digit growth for Asia Pacific and mid-single-digit growth for EMEA. So positive orders across all the major market verticals, but really, the strength is electronics. Jeffrey Sprague: And then just thinking about the new framework here. If we look at the rolling 4 exit for Q4 2025, right, it almost exactly called the 2026 organic growth for both NA and international. So I guess the question here is if we're exiting at 9% to 10% here in Q4 on the rolls -- what's sort of the gap or the hedge between sort of the 5% to 8% or the 4% to 7% that you're giving us in North America and international? Anything else to be aware of in that equation? Jennifer Parmentier: What I would say, Jeff, is that, obviously, the orders remain a leading indicator, but they're not an exact forecast. I think that the 12/12 gets us much closer, as you already pointed out. And the guidance is really in line with the progression of the orders that we've been seeing. Coming out of FY '26 at 3.5% and guiding to 6%, we're really excited about that and really, really happy to see that industrial business be above 6%. And this is at the high end of our target range, too, over the cycle, 4% to 6%. We also -- we have 10% of aerospace and defense business in the Industrial. So that tends to be even a little bit longer. Jeff Sprague: Even longer. Todd Leombruno: I would just add, when you look at the industrial businesses, we are showing an increase from Q4 on an organic basis. When you look at the full year, the comps in the second half get a little bit tougher. So while the organic growth numbers are a little bit lower, it's a little bit more -- from a percentage standpoint, a little bit more weighted in Q1. Operator: We'll go next now to Chris Snyder of Morgan Stanley. Christopher Snyder: Maybe just following up on some of that commentary on the industrial business line. So you guys guided every vertical to mid-single-digit growth in industrial for next year. Can you just maybe talk about ones maybe that are exiting with more strength or the ones where you guys feel better about the prospects and the opportunity into '27? Jennifer Parmentier: Well, what I would say is, again, I'll repeat, as a reminder, 10% of industrial sales are tied to aerospace and defense growing high single digits. So that is very strong. While it's not large enough to be a vertical, we are expecting another year of strong electronics and data center business. When we look at the market vertical forecast and we look at in-plant and industrial equipment, we've been saying for quite some time a gradual recovery here. And it's been very encouraging to see that the demand is improving, and we expect gradual acceleration on a broadening recovery. We've seen distribution orders be strong in the fourth quarter. We're not calling a full restock yet, but we have heard from some distributors that they are doing more stocking than they have done in the past. So we feel really good about what's going to happen in-plant and industrial. Transportation, strong heavy-duty truck orders. Build rates are increasing. When you look at off-highway, acceleration in construction has been driven by infrastructure spend. And as I commented earlier, we see strong power gen growth in the energy vertical. So a lot to be excited about here, and we feel good about the guide here at mid-single-digit growth. Christopher Snyder: Absolutely. And then maybe going over to the M&A side. So obviously, you have the two big deals that are closing over the next quarter or so. Can you just maybe talk about the appetite or bandwidth to do incremental deals in '27? Or is it going to be a year more about focusing on just integrating those two businesses? So anything you could just kind of talk about the appetite, the willingness and then even anything just on the pipeline of opportunities you guys see? Jennifer Parmentier: Yes. So obviously continuing to actively deploy our capital. We're going to get these 2 acquisitions closed. The teams are going to work hard on integration. But the work on the pipeline never stops. We are always working on that pipeline, building relationships with targets. Many times, we're not in control of the timing of when these targets become available. So we might touch 3 with our leverage with these two deals. It will take us about 6 quarters to get that back down to 2. So I would say we still have an appetite, but we're going to stay true to doing what makes sense for the company. Operator: We'll go next now to Steve Volkmann of Jefferies. Stephen Volkmann: I echo the embarrassment of riches. I think you've tripled the margin since I started covering you guys. But in the spirit of what have you done for me lately, I'm curious, I think '27 might be -- we might be on track for an Analyst Day. And I know we've had Win 3.0 here doing well for the last few years. Is there a Win 4.0? And sort of what's next for the Win Strategy? How do you progress from here? Jennifer Parmentier: So there will be a Win 4.0. Definitely, there will be. And we're talking about the next Investor Day now. So I would say stay tuned, but we definitely think that we'll have more things to share in the future. Todd Leombruno: I just checked the math, Steve, you are correct. We have tripled margins since you've been covering us. Stephen Volkmann: Yes. I got it right. So just a quick follow-up here. Are your orders getting a lot lumpier? Are you taking in some like some really chunky orders now and the uncertainty around that, maybe that's behind the switch to the trailing 12 and maybe expecting that the fourth quarter might not be repeated going forward? Jennifer Parmentier: I wouldn't say sitting here today that I don't think the fourth quarter could be repeated. I will tell you that international orders have been very choppy in the past. We've also seen some quarters where we've had some high aerospace and defense orders that are very long term that have hit some of our businesses. And then the next couple of quarters, we don't see that. So we do think that this method of 12/12 is a much better correlation to what we can see for near-term organic growth. The business is just so different than it was when we started reporting these quarterly order rate comparisons. Aerospace, Engineered Materials and Filtration used to be 35% of the company, and now it's 65% of the company. So we really think that this is going to give a more accurate view of what's to come for organic growth. Todd Leombruno: Steve, I would just add, when you think about orders that are lumpy, the aerospace business is a business that jumps off the page. Today, 10% of the industrial business is aerospace and defense end markets. So that does create some choppiness, whether that's in the industrial international businesses or in the North America businesses. So what Jenny said is we feel that this is just a better way to look at it. Operator: We'll go next now to Andy Kaplowitz at Citigroup. Andrew Kaplowitz: Jenny, I think you're prudently initially forecasting 7% to 10% growth for Aero in FY '27. But as you said, you've now had four years in a row of double-digit growth in Aero, and I think backlog is up mid-teens. So maybe give us a little more lay of the land between what you're seeing in commercial aero and defense. Are you still forecasting strong commercial aero aftermarket growth in FY '27, for instance? Or do you expect to see much higher OE-related growth? Jennifer Parmentier: Yes. So I'll give you the rundown of what we have built into the guidance. So for commercial OEM, well, first of all, the OE aftermarket split that we have in the guidance is 52% OE, 48% aftermarket. And we just ended the year at 51% OE, 49% aftermarket. So we're planning on higher OE mix here. Commercial OEM, we see mid-teens growth for the fiscal year, and that's really built on commercial aircraft build rate increases. Aircraft demand is still greater than supply and wide-bodies are growing to meet international traffic demand. Commercial MRO, we're seeing plus mid-single-digit growth for fiscal year '27. There's still a lot of older aircraft flying. The fleet still relies on that. Engine repair shop visits and component restocking continues. And again, international traffic continues to grow faster than domestic. On defense OEM, mid-single-digit growth. Demand for legacy and missile programs continues, increasing defense budgets in response to what's going on in the world and F-35 deliveries are at peak. Defense MRO, plus mid-single-digit growth, and that's really based on fleet upgrades and service extensions, increasing defense budgets and a focus on retrofits and upgrades. So bringing that all together is how we've come up with the guidance for the full year. Andrew Kaplowitz: Very helpful, Jenny. And then, Todd, for the FY '27 margin guide, it was nice to hear that you're guiding to the high end of your normal 30% to 35% incrementals. But obviously, you've been trending closer to 40%. So how should we think about mix or any price cost headwinds impacting the businesses in FY '27? I assume you do want to be somewhat conservative given those things. Todd Leombruno: Yes, that's a great point. When it comes to price, we're obviously going to cover any increases that come across, whether that is tariffs, whether that is labor, whether that's logistics, commodities. So that will be in there. But we've said this constantly, we want to return to a normal pricing environment. And what better time to do that is when you're in an element of growth here. So when you look across the businesses, we are at the higher end of that 30% to 35% range. It feels good when we look at -- when we pressure tested it internally. And I would tell you there's nothing that looks abnormal when it comes to timing on those incrementals. Operator: We'll go next now to Mig Dobre at Baird. Mircea Dobre: A couple of longer-term questions that I guess I'm just going to roll into one. From a capacity standpoint, when we kind of look at your growth, right, you talked about higher growth than what you've had in the past. And I'm sort of curious as to where you are from a capacity standpoint in your facilities, manufacturing facilities to be able to deliver on that sustained higher growth over the next few years. So maybe it'd be helpful if you can comment on that, and I'm thinking about the industrial business specifically. And related to all of this, you guide for CapEx here 2.5% of sales, which is pretty much consistent with what you've done historically. A lot of other industrial companies that are talking about higher growth are also talking about higher CapEx and investing in capacity. So I'm curious if your circumstances are different and whether or not we should be planning for maybe a little more CapEx as we think about later in the decade or maybe early 2030. Jennifer Parmentier: Yes. So actually, Mig, the last -- outside of the last couple of years, we were really more around 2% or a little bit under. And it's just within the last couple of years that we're higher at 2.5%. And we have definitely invested in capacity over the last couple of years, and we have some capacity expansion built into this year. So I think in some businesses, the capacity is already there. Others, we can see that we had to improve, but we're not expecting anything more than we've guided to right now. Another thing, too, that I would tell you is just our ongoing continuous improvement culture and everything that we do with Kaizen and our lean tools -- the whole output of that is, number one, a better working environment for the team member, but higher output and efficiency. And we've really greatly benefited from that over the last several years. So I think that has kept some of our capacity expansion at a much lower rate than possibly others. But we have invested in capacity. We'll continue to do so. Operator: We'll go next now to Jamie Cook with Truist. Jamie Cook: On another fantastic quarter and guidance raise. I guess a couple of questions. Just, Jenny, back to Sprague's question. I don't think you commented on the strength in North America orders, you're up 16%. So sort of what were the end market drivers there? And was there any lumpiness? And even within international, you commented specifically on electronics. Just trying to get a feel for what's going on in the other end markets. And then I guess my second question is just congrats on raising the medium-term targets to 30%. How do we think about what's implied in that margin target in terms of international versus aerospace? Do you think over the next several years, we can get to a point where international closes the gap on aerospace? Or does aerospace continue to move higher to get you to that 30%? Jennifer Parmentier: Okay. Well, I'll take the first half of that, and then I'll pass it over to Todd. So first of all, for orders in Q4 in North America, obviously, 16% on the 3/12 and 9% on the 12/12 that we're talking about. So strength in Aerospace and Defense, in-plant and I mentioned that we saw distribution orders much stronger in Q4. Construction, again, on infrastructure spending and heavy-duty truck and commercial HVAC. So really, we saw positive orders across all of the major market verticals. International, plus 24%. I did mention earlier that kind of that easy comp, but still 10% on a 12/12, it was really driven by electronics and in-plant, double-digit growth for Asia Pacific and mid-single-digit growth for EMEA. In EMEA, we do see some strength in construction and mining and some in-plant. But again, positive orders across all of those verticals. And with aerospace, listen, double-digit growth in both commercial OEM and aftermarket and strength in defense OEM. So defense OEM was stronger than expected with double-digit order growth. So really just a really nice quarter for orders. Todd Leombruno: Jenny, I can speak about the FY '31 walk. The thing I love about these targets is that everyone has a part in these targets, just like the way we got to over 27%, every single one of our businesses has generated higher margins than they did when we started those targets. So everyone's got a new target, and that's what I love about the company. Aerospace has been outsized when it comes to margin expansion, four years of double-digit organic growth, great aftermarket exposure and growth has really helped that. But we expect every one of these businesses to be part of our walk to FY '30, including Aerospace. Our international teams have done an unbelievable job. They are constantly looking at growth opportunities, cost-out opportunities. And that's no different than North America. My gut feel here would say the North American or the industrial businesses will expand more than aerospace, just with what Aerospace has on its plate with next-gen investments and OEM mix. They still will expand margins, but I think the industrial businesses will expand at a greater clip as we walk to FY '30. Operator: We'll go next now to Tim Thein with Raymond James. Timothy Thein: I had a longer-term question on Aerospace within the context of your 2031 target, the organic growth target. I'm just curious, I mean, they're obviously coming off what is, as Todd pointed out, a really long stretch of growth, but the demand backdrop for both commercial and defense seems to be getting a bit better. So -- and you obviously have a bit more visibility here given the backlog. So how would you think about that kind of growth algorithm for aerospace looking out beyond '27? Jennifer Parmentier: We've forecasted long-term growth drivers for each of the areas in aerospace. And we see aerospace as high single digits through that time period. So we feel like it's going to be -- just going to continue at that rate until the time that we reach these targets. Todd Leombruno: We'll also have the CIRCOR aerospace and defense business, when that closes, that will be another growth driver, obviously, from the equipment side. But once that becomes organic over the five-year period, that will be another growth driver when it comes to aerospace. And again, I can't deemphasize enough, 10% of the industrial business has aerospace and defense end market exposure. Timothy Thein: Yes. Understood. And then just on more near term on pricing with respect to aerospace, just given some of the LTAs that I'm guessing were -- may have been renegotiated coming out of COVID may have provided a little bit of a bump. Are we kind of back to a setting where those are more, I guess, normal in terms of the -- I guess the spirit of the question is just the contribution to price, not asking for quantification, but just directionally, how that is trending in '27? Jennifer Parmentier: Yes. So on the industrial side of the business, we are back to a -- what we would consider more of a normal pricing environment. And in aerospace, there's still pricing opportunity. There have been a lot of negotiations. There are some negotiations that are still in play. So I would say that there's still some opportunity in aerospace. Operator: We'll go next now to Amit Mehrotra at UBS. Amit Mehrotra: I guess the first one, just on the North American industrial inflection, the 16% growth of orders. Any color you could talk about between sort of the distribution channel and the direct OEM channel? I know the distributor channel has been maybe a little bit more stubborn, and I think you talked about it a little bit more positively, but any more color around the activity you're seeing and the confidence coming back in that specific channel? Jennifer Parmentier: Yes. Look, I've been saying for a lot of quarters here that distributors have been very positive. And the order growth, the strength that we saw in Q4 really supports that positive sentiment and what they've been telling us. So we definitely feel like that is a broadening recovery instead of what we've just been saying as a gradual recovery. So we feel good about that. Still not calling a restock though. Some distributors are telling us that they are stocking for projects that they're working on for their customers or business that they see coming. But I wouldn't call the whole channel as an overall restock. On the OEM side, obviously, we've seen production rates increase for heavy-duty truck. That's been very encouraging. We've seen construction and mining get stronger. But we've also seen agriculture remain where it's been pretty soft and automotive pretty soft. But there's commercial HVAC and refrigeration that is growing. There's energy with power gen. So there's been some strong OEM orders and strong OEM growth along with what we see in distribution. Amit Mehrotra: Okay. And just the sort of natural follow-up question to that is, obviously, the mix dynamic, if there is one between distributors versus OEM has -- I know you've taken a lot of price in the distribution channel, and we're kind of waiting for the volume to recover. If I think about this guidance of inflection in growth -- organic growth in North American Industrial, is it all the incremental -- is it all volume? Is there a little bit more price as maybe some of that distribution volume comes through? Just give us a little bit of a flavor specifically with North American Industrial. Jennifer Parmentier: Yes. We're back to a normal pricing environment here, and this is all volume. Operator: We'll go next now to Andrew Buscaglia at BNP Paribas. Andrew Buscaglia: I know this is small, but can you comment on your data center exposure? I believe you have some interesting equipment hoses and connectors that play into the space. And I'm wondering if you're seeing interesting order activity there. And then any comments you can make on -- are you seeing any specification activity related to liquid cooling as an interesting growth driver? Jennifer Parmentier: Yes. So we do have really nice exposure, and it grew nicely last year, and we think it's going to continue to grow. It's about 1.5% of our sales, and we've been previously saying 1%. So it is growing, but it's not quite large enough yet to have its own market vertical. This is a great story for our interconnected technologies because you mentioned a few of our products, but it's hoses, couplings, manifolds, fittings -- engineered materials for thermal management. So really, really a good showcase of all of the Parker technologies. And we are working with the industry leaders. We are seeing good orders here. We provide liquid cooling systems and subsystem components. So our teams are doing a really fantastic job in this space. We have a very highly skilled, high-performance team serving these data center customers. And as I mentioned, it's a nice growth area. Andrew Buscaglia: Okay. And maybe just on the longer-term outlook, I couldn't help but notice you call for about 200 basis point margin expansion in 2027 and 2029 and a 300 basis point step-up from 2029 to 2031. I think I got that right. Why would you -- what gives you that confidence? Do you see sort of an acceleration in your margins? And I wonder if it's pertaining to the recent acquisitions that you expect to close? Todd Leombruno: Yes, I could take that. Just to clarify, what we are calling out is we're calling out 300 basis points of improvement from a 27.0% target that we just surpassed in FY '26. That was originally our FY '29 target. We're restating that to FY '31 and the new target is 30% adjusted segment operating margins. So as far as what's going to get us there, we have included the Filtration Group Corporation acquisition and the CIRCOR aerospace and defense business in those margin targets. But when you look at that, it's really coming from our existing business just because of the size of the existing business is so much greater than those two great additions we're going to have, and it's going to be everything that got us to 27.3% this year, just more of it. So we feel really confident about the walk to get there, and it should be spread pretty equally across those years, each of the five years. Operator: We'll go next now to Nicole DeBlase with Deutsche Bank. Nicole DeBlase: Congrats on a really great quarter. I guess maybe first, Jenny, if we could touch on how the orders progressed throughout the quarter? And if you've observed continued strength in July, I would assume so based on what you guys expect for '27, but would love to hear any perspective on that. Jennifer Parmentier: I would say that there's nothing that's happened that concerns me that would not support the guide that we put out. Nicole DeBlase: Okay. Understood. And then with the electronics strength in international, was that like are there big lumpy orders that are coming through in the quarter? Do you -- what I'm trying to get at is, is that electronic strength sustainable? Or do you think that was kind of like a 4Q dynamic that might not last into 2027? Jennifer Parmentier: I think it's going to remain strong. I mean, obviously, it came in much stronger than we were expecting. I think we had about a 10% in for Asia Pacific, and it came in much stronger. So I would say the guide reflects what we expect out of international, but this is a strong area for us. Operator: We'll go next now to Nathan Jones with Stifel. Nathan Jones: I guess I'll follow up a little bit on some of the international order strength here, kind of alluding that there's a good chance that, that continues. If it does, would that maybe improve the outlook for the second half of fiscal '27? And in the guidance that you've given out today, do you assume that some of this order strength in international and in North America continues or that it moderates a little bit from here? Jennifer Parmentier: What we have in the guide right now is what we see with the order progression that's out there. So obviously, we did have a very strong Q4 orders to support what we have in for Q1 and for the rest of the year. So I would tell you that, obviously, we -- as the year goes on, we hope that we can raise those, but this is the best picture we have right now. Todd Leombruno: Well, our 48-52 split somehow works out every year, year after year. That's what we are guiding for here. I think it's more of a comp issue. Just the second half of FY '26 was so good, the comps get a little bit tougher. But if you look at the dollars, the dollars are weighted like they normally are much heavier in the second half. Nathan Jones: A follow-up question on the CIRCOR aerospace business. Can you just talk a little bit more about what the strategy is with that? I think it already has extremely high margins after it got rid of all the build-to-print work several years ago. So is this a revenue synergy play? It doesn't seem like it would be a cost synergy play given the margins are already high. But just any comments you can make around the strategy for that acquisition, please? Jennifer Parmentier: Sure. So it is the highest growth, highest margin acquisition to date. What we love about CIRCOR is it brings complementary flight-critical motion and flow control capabilities to our portfolio. And as I mentioned before, these are proprietary technologies. This is what we like to bring into our suite of projects. This is an 80% OEM business and 50-50 sales split across commercial and defense. We have not modeled any revenue synergies. We have said 10% synergies. That's approximately $26 million. They ended calendar year '26 -- their estimate for calendar year '26 is $270 million with more than 40% adjusted EBITDA margin, and that's before synergies. So this is going to be a really nice addition to our portfolio. And like I said earlier, we'll get this hopefully closed before the end of this calendar year. Operator: We'll go next now to Joe Giordano with TD Cowen. Joseph Giordano: The growth by end market that you guys have for next year, like how consistent is that with where order rates were for you by those end markets for '26? Todd Leombruno: So I think it's pretty consistent. We finished the year pretty strong on an order exit rate. We called out the longer cycle nature of some of those things. But what we're guiding for, to give you an example, for Q1 is a slight increase from where we exited Q4. So like Jenny said, I think we're giving you the best look that we can right now with the visibility that we have. And we feel pretty positive. This is the highest organic growth guide that we've had in modern history. Joseph Giordano: And that's consistent on like an end-market basis as well, like not like a buildup of backlog anywhere in any of those particular end markets? Todd Leombruno: No. I mean there might be a little bit more strength in heavy-duty truck, but everything else is pretty consistent. That's why they're all mid-single-digit growth forecasts. Joseph Giordano: And you don't feel like there's any pull-forward or anything into the fourth quarter from anything that would have been 1Q orders? Todd Leombruno: No. We never really experienced that. I think our focus for years has been on delivering to customers when they need it. And we've been active on price and making sure that there's no slippage in when orders were placed. So... Jennifer Parmentier: One of the things that we've worked really hard on the last several years is demand and capacity planning with our customers and with our suppliers. So that's something that's given us the ability to be much more efficient in our operations and make sure that the customers know that they can get the product from Parker in a stated lead time. Todd Leombruno: Bo, I think we might have time for one more if we have anyone left in the queue. Operator: We do. We'll take our final question today from Chigusa Katoku with JPMorgan. Chigusa Katoku: Just want to touch briefly on energy. I think it's a tale of two worlds, power strong and oil and gas softer. I think last quarter, you expected 2026 was about low single-digit for this vertical, and you're expecting mid-single digit this year. I'm just curious, is this more driven by power being stronger and oil and gas kind of unchanged? Just any color there would be great. Jennifer Parmentier: Yes. We definitely see power gen growth, and we think that's going to continue to be strong and a little bit stronger. Oil and gas, we think it's going to be flat. There could be an up-cycle coming, but we don't have any signs of that yet. So this is flat oil and gas and stronger power gen growth. Chigusa Katoku: Okay. Great. And then just trying to put a finer point on the orders acceleration in North America industrial. It really accelerated nicely. It sounded like it was broad-based. You didn't -- I didn't hear you call out power or data center, but what were kind of the trends there? Just if you could put any finer point on what really led to this acceleration versus the third quarter, that would be helpful. Jennifer Parmentier: Yes. I mean it was across many market verticals. We saw strong aerospace and defense in the industrial businesses, in-plant and industrial demand, higher distribution. We saw transportation improvement with heavy truck. We saw construction growth. We saw power gen growth and commercial HVAC. So we just saw really, really nice growth across all the market verticals. Todd Leombruno: Okay. I think that is all we have from a time standpoint. We appreciate everyone joining today. We appreciate your attention. FY '26 was just a great year for Parker-Hannifin. It was our safest year ever. It was another year of operational excellence. And obviously, as Jenny said, a very active year when it comes to capital deployment. We are looking forward to an even better FY '27. We are confident in that path to our new 30% segment operating margin target by FY '31. And really, none of this could be possible without a sincere thank you to our global team members around the world and to our investors for your interest in Parker-Hannifin. So thank you all very much. Jeff and Jenna will be available today if there's any follow-ups that are needed. Thanks again for joining us, and have a great day, everyone. Operator: Thank you very much, Mr. Leombruno, and thank you, Ms. Parmentier. Again, ladies and gentlemen, this will conclude today's Parker-Hannifin Corporation's Fiscal 2026 Fourth Quarter and Full Year Earnings Conference Call and Webcast. Again, thanks so much for joining us, everyone. We wish you all a great afternoon. Goodbye. Before you buy stock in Parker-Hannifin, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Parker-Hannifin wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $403,337!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,334,946!* Now, it’s worth noting Stock Advisor’s total average return is 958% — a market-crushing outperformance compared to 214% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 13, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Parker-Hannifin (PH) Q4 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Parker-Hannifin Corporation? Here are five stocks we like better. Parker-Hannifin reported record fiscal 2026 results: Sales surpassed $21.5 billion, organic growth reached 6.6%, adjusted EPS rose 18% to $32.31, and operating cash flow hit a record $4.4 billion. Aerospace remained a major growth driver, with fourth-quarter organic sales growth of 13.4%, a 29.8% operating margin and backlog increasing 15% to a record $8.5 billion. The company initiated fiscal 2027 guidance for 5.5%–8.5% sales growth and adjusted EPS of $34.75, while setting a new long-term adjusted operating-margin target of 30% by fiscal 2031 and pursuing the pending Filtration Group and CIRCOR acquisitions. The Lock-In Effect Is Real—These 3 Homebuilders Are Betting on It Parker-Hannifin (NYSE:PH) reported record fiscal 2026 results, including first-time annual sales above $20 billion, record operating cash flow and adjusted earnings per share growth of 18%, as the industrial and aerospace manufacturer also introduced fiscal 2027 guidance calling for another year of growth. Chairman and Chief Executive Officer Jennifer Parmentier said fiscal 2026 sales reached $21.5 billion, with organic growth accelerating to 6.6%. Adjusted segment operating margin expanded 120 basis points to a record 27.3%, while adjusted EPS rose to $32.31. Cash flow from operations increased to a record $4.4 billion, surpassing $4 billion for the first time. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling Netflix, Pulte, and Mobileye Are Buying Their Own Dips—Should You? Parmentier also said the company reduced its recordable incident rate by 9%, calling fiscal 2026 Parker-Hannifin's safest year on record. Chief Financial Officer Todd Leombruno said the company finished the year with record fourth-quarter sales, margins, net income and adjusted EPS. Quarterly sales rose 10% from a year earlier, including 8% organic growth, while the Curtis Instruments acquisition contributed 1.5 percentage points to sales growth. Currency was slightly unfavorable. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High Homebuilder Earnings: D.R. Horton Sticks Out as Pulte & NVR Sales Tank Fourth-quarter adjusted segment operating margin rose 110 basis points to 28.0%, the first time Parker-Hannifin exceeded that level. Adjusted EBITDA margin was 28.6%, and adjusted EPS increased 21% to $9.27. Leombruno said more than 80% of the year-over-year EPS increase came from higher segment operating income. Orders increased 19% on the company's prior three-month comparison basis and 12% on a rolling 12-month basis. Backlog rose 16% to a record $12.8 billion. North American industrial sales were $2.2 billion, with organic growth of about 5% and a record 27.4% adjusted operating margin. International industrial sales reached a record $1.6 billion, with 6.5% organic growth. Asia-Pacific organic growth was 16%, while Europe, the Middle East and Africa grew 1% and Latin America declined 3%. Aerospace quarterly sales reached a record $1.9 billion, with 13.4% organic growth and a 29.8% margin. Aerospace backlog rose 15% to a record $8.5 billion. → No Hangover: Revisiting Microsoft One Week After Earnings Parmentier said aerospace recorded its fourth consecutive full fiscal year of double-digit organic growth. In the fourth quarter, aerospace orders rose 18%, supported by double-digit growth in commercial original equipment and aftermarket activity, as well as strength in defense OEM markets. Having exceeded its fiscal 2029 margin target ahead of schedule, Parker-Hannifin set a new adjusted segment operating margin target of 30% by fiscal 2031. The target represents a 300-basis-point increase from the prior 27% objective. The company retained its longer-term goals of 4% to 6% organic growth through the cycle, a 17% free-cash-flow margin and adjusted EPS growth above 10% through the cycle. Leombruno said the company expects all businesses to contribute to the margin expansion, though he expects industrial operations to expand faster than aerospace as the company works toward the 2031 target. Parker-Hannifin will also shift industrial order-rate reporting to a rolling 12-month calculation beginning in fiscal 2027. Parmentier said the company has changed significantly since it began reporting quarterly industrial order comparisons two decades ago, with aerospace, engineered materials and filtration technology platforms representing about 65% of pro forma sales following the expected Filtration Group transaction. Management said the rolling 12-month measure has a stronger correlation with near-term organic sales growth, particularly as Parker-Hannifin has gained greater exposure to longer-cycle markets. The company deployed or announced more than $15 billion of capital actions during fiscal 2026. Parker-Hannifin completed its $1 billion acquisition of Curtis Instruments in September, expanding its electrification capabilities. It also announced pending acquisitions of Filtration Group Corporation and CIRCOR's commercial Aerospace & Defense business, representing nearly $12 billion in announced transactions. Parmentier said the Filtration Group deal would expand Parker-Hannifin's proprietary filtration offerings and increase its filtration aftermarket exposure by 500 basis points. The CIRCOR transaction is intended to add complementary flight-critical motion and flow-control technologies. Management expects both pending acquisitions to close during the second half of the calendar year, subject to customary closing conditions and regulatory approvals. The company said it has not modeled revenue synergies for the CIRCOR business but expects about $26 million of synergies, or roughly 10%. During fiscal 2026, Parker-Hannifin returned nearly $2 billion to shareholders through approximately $1 billion in buybacks and nearly $1 billion in dividends. It also invested $500 million in capital expenditures. Despite those actions, net debt-to-adjusted EBITDA declined to 1.4 times from 1.7 times a year earlier. Parker-Hannifin initiated fiscal 2027 guidance for reported and organic sales growth of 5.5% to 8.5%, with a 7% midpoint that would translate to roughly $23 billion in annual sales. The outlook excludes contributions from the pending Filtration Group and CIRCOR transactions. The company forecast 6.5% organic growth at the midpoint for North American industrial operations, 5.5% for international industrial operations and 8.5% for aerospace. Adjusted segment operating margin is expected to reach 27.7% at the midpoint, up 40 basis points from fiscal 2026, while adjusted EPS is projected at $34.75, up 8%. Management forecast positive growth across every major market vertical. Aerospace and defense is expected to grow at a high-single-digit rate, supported by mid-teens commercial OEM growth, sustained commercial aftermarket activity and solid defense demand. Parker-Hannifin expects mid-single-digit growth in industrial, transportation, off-highway, energy, HVAC and refrigeration markets. For energy, Parmentier said the company expects strong and sustained demand tied to gas-turbine power generation, while oil and gas activity is expected to be flat. She also said data-center-related sales now account for about 1.5% of company revenue and are expected to continue growing, supported by liquid-cooling systems and related components. Parker-Hannifin Corporation (NYSE: PH) is a global manufacturer and provider of motion and control technologies and systems. The company designs, manufactures and services a broad range of engineered components and systems used to control the movement and flow of liquids, gases and hydraulic power. Its product portfolio is applied across demanding environments and includes solutions for industrial manufacturing, aerospace, mobile equipment and other engineered applications. Parker-Hannifin's product and service offerings span hydraulic and pneumatic components, fittings and fluid connectors, valves, pumps and motors, electromechanical actuators and motion-control systems, filtration and separation products, and seals and sealing systems. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Parker-Hannifin Q4 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Parker-Hannifin reported past fourth-quarter 2026 results with sales rising to US$5,755 million and net income to US$1,091 million, while issuing fiscal 2027 guidance that projects reported sales growth of 5.5% to 8.5% and EPS of US$30.00 to US$31.00. The company’s record fiscal 2026 performance, improved operating margins, and strong order and backlog trends across industrial and aerospace segments highlight increasingly efficient operations and robust demand visibility. Next, we’ll examine how Parker-Hannifin’s upgraded earnings guidance and record backlog influence its existing investment narrative and long-term expectations. This technology could replace computers: discover 26 stocks that are working to make quantum computing a reality. To own Parker-Hannifin, you need to believe its mix of industrial and aerospace businesses can sustain healthy earnings while managing higher debt and rich valuation multiples. The latest record fiscal 2026 results and fiscal 2027 guidance support the near term catalyst of strong aerospace and industrial demand, but they do not remove key risks around dependence on aerospace cycles, integration of past acquisitions, and the possibility that slower core industrial growth could weigh on future profitability. The most relevant recent announcement is Parker-Hannifin’s fiscal 2027 guidance calling for reported sales growth of 5.5% to 8.5% and EPS of US$30.00 to US$31.00. Coming on the heels of a quarter where operating margins reached about 28% and orders and backlog hit new highs, this guidance reinforces the current catalyst of margin efficiency and demand visibility, while also sharpening the focus on whether the company can sustain this level of performance without pressuring free cash flow and capital returns. Yet beneath the strong guidance and record backlog, investors should also be aware of how rising capital intensity and restructuring costs could start to challenge... Read the full narrative on Parker-Hannifin (it's free!) Parker-Hannifin's narrative projects $25.1 billion revenue and $4.6 billion earnings by 2029. This requires 6.1% yearly revenue growth and roughly a $1.1 billion earnings increase from $3.5 billion today. Uncover how Parker-Hannifin's forecasts yield a $1032 fair value, a 4% downside to its current price. Some of the most optimistic analysts already expected Parker-Hannifin to reach about US$26.0 billion in revenue and US$4.8 billion in earnings by 2029, which is a much more upbeat narrative than the baseline view. They also highlighted risks like decarbonization pressure on legacy products, which sits alongside current concerns about aerospace dependence. After such a strong 2026 print and upgraded 2027 outlook, both sets of assumptions may need a fresh look. Explore 5 other fair value estimates on Parker-Hannifin - why the stock might be worth 30% less than the current price! Don't just follow the ticker - dig into the data and build a conviction that's truly your own. A great starting point for your Parker-Hannifin research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision. Our free Parker-Hannifin research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Parker-Hannifin's overall financial health at a glance. Every day counts. These free picks are already gaining attention. See them before the crowd does: We've uncovered the 9 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. AI is about to change healthcare. These 42 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. Find 50 companies with promising cash flow potential yet trading below their fair value. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include PH. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Tennant (TNC) came out with quarterly earnings of $0.83 per share, missing the Zacks Consensus Estimate of $1.23 per share. This compares to earnings of $1.49 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -32.52%. A quarter ago, it was expected that this maker of products for cleaning floors, parking lots and hospitals would post earnings of $0.24 per share when it actually produced earnings of $0.58, delivering a surprise of +141.67%. Over the last four quarters, the company has surpassed consensus EPS estimates just once. Tennant, which belongs to the Zacks Manufacturing - General Industrial industry, posted revenues of $324 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.89%. This compares to year-ago revenues of $318.6 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Tennant shares have added about 21.1% since the beginning of the year versus the S&P 500's gain of 13%. While Tennant has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Tennant was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.54 on $321.2 million in revenues for the coming quarter and $5.12 on $1.27 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Manufacturing - General Industrial is currently in the top 22% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Parker-Hannifin (PH), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This maker of motion and control products is expected to post quarterly earnings of $8.29 per share in its upcoming report, which represents a year-over-year change of +7.8%. The consensus EPS estimate for the quarter has been revised 0.1% higher over the last 30 days to the current level. Parker-Hannifin's revenues are expected to be $5.61 billion, up 6.9% from the year-ago quarter. 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 Tennant Company (TNC) : Free Stock Analysis Report Parker-Hannifin Corporation (PH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Revenue: Record fiscal year 2026 sales of $21.5 billion, surpassing $20 billion for the first time in company history. Fourth quarter sales were up 10% versus prior year. Organic Growth: Accelerated to 6.6% for the full fiscal year. Fourth quarter organic growth was 8%, the strongest quarter of the fiscal year. Adjusted Segment Operating Margin: Expanded 120 basis points to a record 27.3% for the full year. Fourth quarter margin was 28.0%, up 110 basis points from prior year. Adjusted EBITDA Margin: Record 28.6% for the fourth quarter, up 180 basis points. Adjusted Earnings Per Share: Increased 18% to a record $32.31 for the full year. Fourth quarter adjusted EPS was $9.27, up 21%. Cash Flow from Operations: Record $4.4 billion for the full year, surpassing $4 billion for the first time, representing 20.3% of sales. Free Cash Flow: Record $3.9 billion, up 17% versus prior year, with a conversion rate of 107%. Segment Performance (Q4): North American sales were $2.2 billion with organic growth of 5%; International sales were a record $1.6 billion with organic growth of 6.5%; Aerospace sales were a record $1.9 billion with organic growth of 13.4%. Backlog: Increased 16% versus prior year to a new record of $12.8 billion. FY27 Guidance: Reported sales growth of 5.5% to 8.5% (7% at midpoint), adjusted segment operating margin of 27.7% at midpoint, and adjusted EPS of $34.75 at midpoint. Warning! GuruFocus has detected 6 Warning Sign with PH. Is PH fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Record fiscal year 2026 performance with sales surpassing $20 billion for the first time, reaching $21.5 billion, and organic growth accelerating to 6.6%. Adjusted segment operating margin expanded 120 basis points to a record 27.3%, and the company raised its long-term margin target to 30% by fiscal year 2031. Record cash flow generation with cash flow from operations at $4.4 billion and free cash flow at $3.9 billion, both all-time highs, with a conversion rate of 107%. Strong order momentum across all segments, with total orders up 19% on a three-month comparison and backlog reaching a record $12.8 billion, up 16% year-over-year. Aerospace segment continues to outperform with a fourth consecutive year of double-digit organic growth, record sales of $1.9 billion in Q4, and a record backlog of $8.5 billion. Strategic capital deployment of over $15 billion, including the acquisitions of Curtis Instruments, Filtration Group Corporation, and CIRCOR's Commercial Aerospace and Defense business, positioning the company for future growth. Fiscal year 2027 guidance implies a slowdown in adjusted EPS growth to 8% (to $34.75) from the 18% growth achieved in fiscal year 2026. The company faces a headwind from income taxes in fiscal year 2027, with a forecasted tax rate of 22.5% compared to favorable discrete items in the prior year. Currency is expected to be a slight headwind, with a negative 0.5% impact on sales growth in fiscal year 2027. Certain end markets remain soft, including Agriculture, which is expected to continue its weakness, and Oil & Gas, which is forecasted to be flat in fiscal year 2027. The company is not yet calling a full restock in the distribution channel, indicating some uncertainty about the sustainability of the industrial recovery. The pending acquisitions of Filtration Group and CIRCOR are not included in the fiscal year 2027 guidance, creating potential execution and integration risks. Q: What are the final hurdles left to close the Filtration Group and CIRCOR acquisitions?A: CEO Jennifer Parmentier stated there are no major hurdles. Both acquisitions are expected to close during the second half of calendar year 2026 (first half of fiscal 2027), subject to customary conditions and pending regulatory clearances. The processes are ongoing and progressing for both transactions. Q: Can you provide more color on the strength of orders in the quarter, particularly in International?A: CEO Jennifer Parmentier noted that International orders were up 24% on a 3-month comparison (10% on a rolling 12-month basis), driven primarily by Electronics and In-Plant demand. Asia Pacific saw double-digit growth, while EMEA grew mid-single digits. The strength was broad-based, with positive orders across all major market verticals, though the prior year comparison was an easy 0% comp. Q: What is the rationale behind the move to rolling 12-month order rates beginning in fiscal 2027?A: CEO Jennifer Parmentier explained that Parker's portfolio has transformed significantly over the last decade, with Aerospace, Engineered Materials, and Filtration now representing approximately 65% of pro forma sales (up from 35%). These longer-cycle businesses have different order patterns, and rolling 12-month orders provide a stronger correlation to near-term organic sales growth. CFO Todd Leombruno added that the Aerospace business, which now represents 10% of Industrial sales, creates choppiness in quarterly order comparisons. Q: What are the key drivers behind the new FY31 adjusted segment operating margin target of 30%?A: CFO Todd Leombruno stated that the 300 basis point improvement from the 27% target (achieved early in FY26) will come from every business contributing, similar to how the company reached 27.3%. He expects Industrial businesses (North America and International) to expand margins at a greater clip than Aerospace, which faces next-gen investments and OEM mix headwinds. The targets include contributions from the pending Filtration Group and CIRCOR acquisitions, but the majority will come from existing operations. Q: How should we think about the FY27 margin guide and incrementals?A: CFO Todd Leombruno said the company is forecasting incrementals near the top end of its stated 30% to 35% range. Price will cover any cost increases from tariffs, labor, logistics, or commodities, but Parker is returning to a normal pricing environment. The margin expansion will be spread across all businesses, with adjusted segment operating margin guided to 27.7% at the midpoint for FY27. Q: Can you provide more detail on the Aerospace segment outlook for FY27?A: CEO Jennifer Parmentier provided a breakdown: Commercial OEM is expected to grow mid-teens, driven by aircraft build rate increases and widebody growth. Commercial MRO is expected to grow mid-single digits, supported by an aging fleet and continued international traffic growth. Defense OEM is expected to grow mid-single digits, with F-35 deliveries at peak. Defense MRO is also expected to grow mid-single digits, driven by fleet upgrades and service extensions. The OE/aftermarket mix is expected to shift slightly toward OE at 52%/48%. Q: What is the strategy behind the CIRCOR Aerospace and Defense acquisition?A: CEO Jennifer Parmentier described it as the highest growth, highest margin acquisition to date. CIRCOR brings complementary flight-critical motion and flow control capabilities with proprietary technologies. It is an 80% OEM business with a 50-50 commercial/defense split. The company has not modeled revenue synergies but expects approximately 10% cost synergies ($26 million). CIRCOR's calendar year 2026 revenue is estimated at $270 million with more than 40% adjusted EBITDA margins before synergies. Q: Are you seeing any interesting order activity in the data center space?A: CEO Jennifer Parmentier noted that data center exposure is growing nicely and now represents about 1.5% of sales (up from 1%). The company provides liquid cooling systems and subsystem components, including hoses, couplings, manifolds, and engineered materials for thermal management. Parker is working with industry leaders and seeing good orders in this area, which showcases its interconnected technologies. Q: What is the outlook for the Energy vertical in FY27?A: CEO Jennifer Parmentier stated that Power Gen growth is expected to be strong and continue accelerating, driven by gas turbine power generation. Oil & Gas is expected to be flat, with no signs of an up cycle yet. This results in an overall mid-single-digit growth forecast for the Energy vertical. Q: Is the strength in Electronics orders in International sustainable, or was it a one-quarter dynamic?A: CEO Jennifer Parmentier indicated that Electronics strength is expected to remain strong. The segment came in much stronger than expected (Asia Pacific was forecast at 10% but exceeded that), and the FY27 guidance reflects expectations for continued strength in this area. She noted that nothing has occurred that would concern her regarding the guidance provided. For the complete transcript of the earnings call, please refer to the full earnings call transcript.