Stock Analysis on Net
Stock Analysis on Net

Parker-Hannifin Corp. (NYSE:PH)

$22.49

This company has been moved to the archive! The financial data has not been updated since February 7, 2023.

Analysis of Liquidity Ratios

Microsoft Excel

Liquidity ratios measure the company ability to meet its short-term obligations.

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Liquidity Ratios (Summary)

Parker-Hannifin Corp., liquidity ratios

Microsoft Excel
Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017
Current ratio
Quick ratio
Cash ratio

Based on: 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30).

Current Ratio
The current ratio exhibited a generally positive trend over the analyzed period. Starting at 1.41 in mid-2017, it increased to 2.43 by mid-2019, indicating an improved ability to cover short-term liabilities with current assets. Although there was a decline to 1.55 in 2020, likely influenced by external factors such as the global pandemic, the ratio recovered to 2.06 by mid-2022, suggesting enhanced liquidity management and a strengthening short-term financial position.
Quick Ratio
The quick ratio showed more volatility compared to the current ratio. It rose from 0.92 in 2017 to 1.84 in 2019, demonstrating increased liquidity excluding inventory. However, post-2019, the quick ratio experienced a significant decline to 0.91 in 2020 and further dropped to 0.59 by 2022. This downward trend suggests a decreased availability of liquid assets relative to current liabilities, potentially signaling tighter liquidity or a shift in asset composition.
Cash Ratio
The cash ratio remained relatively low and declined overall. Initially stable at 0.27 in 2017 and 2018, it peaked at 1.07 in 2019, indicating a strong cash position relative to current liabilities during that year. Following 2019, the ratio sharply decreased to 0.24 in 2020 and continued downward to 0.10 by 2022. This decline points to a reduction in cash and cash equivalents relative to current liabilities, which may raise concerns regarding immediate liquidity availability.

Current Ratio

Parker-Hannifin Corp., current ratio calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017
Selected Financial Data (US$ in thousands)
Current assets
Current liabilities
Liquidity Ratio
Current ratio1
Benchmarks
Current Ratio, Competitors2
Boeing Co.
Caterpillar Inc.
Eaton Corp. plc
GE Aerospace
Honeywell International Inc.
Lockheed Martin Corp.
RTX Corp.
Current Ratio, Sector
Capital Goods
Current Ratio, Industry
Industrials

Based on: 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30).

1 2022 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =

2 Click competitor name to see calculations.

Current Assets
The data indicates a fluctuating yet overall increasing trend in current assets from mid-2017 to mid-2022. Starting at approximately 4.78 billion USD in 2017, current assets steadily grew with a notable spike in 2019 reaching over 7.67 billion USD. Despite a sharp decline in 2020 to about 4.89 billion USD, the figure rebounded in subsequent years, culminating in a significant increase to roughly 12.05 billion USD by mid-2022.
Current Liabilities
Current liabilities have demonstrated relative stability around the 3.1 to 3.4 billion USD range between 2017 and 2021. However, a marked increase is observed in 2022, where liabilities nearly doubled to approximately 5.86 billion USD. This abrupt rise suggests a substantial change in short-term obligations during the latest period.
Current Ratio
The current ratio shows variability over the analyzed years but remains above 1.0 throughout, indicating that current assets consistently exceed current liabilities. The ratio improved from 1.41 in 2017 to peak at 2.43 in 2019, reflecting enhanced short-term liquidity at that time. Following a decrease in 2020 to 1.55, the current ratio gradually improved again, reaching 2.06 by mid-2022, suggesting strengthened ability to cover short-term debts despite the surge in current liabilities.

Quick Ratio

Parker-Hannifin Corp., quick ratio calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017
Selected Financial Data (US$ in thousands)
Cash and cash equivalents
Marketable securities and other investments
Trade accounts receivable, net
Non-trade and notes receivable
Total quick assets
 
Current liabilities
Liquidity Ratio
Quick ratio1
Benchmarks
Quick Ratio, Competitors2
Boeing Co.
Caterpillar Inc.
Eaton Corp. plc
GE Aerospace
Honeywell International Inc.
Lockheed Martin Corp.
RTX Corp.
Quick Ratio, Sector
Capital Goods
Quick Ratio, Industry
Industrials

Based on: 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30).

1 2022 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =

2 Click competitor name to see calculations.

Total quick assets
The total quick assets showed an overall increase from June 30, 2017, to June 30, 2019, starting at approximately 3.11 billion USD and rising sharply to 5.81 billion USD. However, there was a significant decline in 2020, dropping to around 2.86 billion USD, followed by a gradual recovery in 2021 and 2022, reaching approximately 3.45 billion USD in the latest period. This pattern suggests a period of asset accumulation until 2019, considerable reduction in 2020, and partial replenishment thereafter.
Current liabilities
Current liabilities generally decreased modestly from around 3.40 billion USD in 2017 to 3.10 billion USD in 2021, indicating improved short-term obligations management over these years. However, in 2022, current liabilities increased sharply to about 5.86 billion USD, representing a significant jump and potential increase in short-term financial commitments or obligations.
Quick ratio
The quick ratio fluctuated significantly over the periods, starting below 1 at 0.92 in 2017, indicating limited immediate liquidity relative to current liabilities. It improved to over 1.0 in 2018 and peaked at 1.84 in 2019, demonstrating a strong liquidity position during that year. However, the ratio dropped below 1.0 again in 2020 to 0.91, increased slightly above 1.0 in 2021, and then sharply decreased to 0.59 in 2022. The 2022 ratio indicates a weakened liquidity position, with quick assets covering only 59% of current liabilities.
Summary
The financial data reveals volatility in liquidity and asset levels. After a peak in quick assets and liquidity ratio in 2019, both measures declined substantially in 2020. While there was some recovery in 2021, the sharp increase in current liabilities combined with lower quick assets in 2022 led to a notably weakened liquidity position. These trends may indicate operational challenges or changes in capital structure and short-term obligation management in the most recent year.

Cash Ratio

Parker-Hannifin Corp., cash ratio calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017
Selected Financial Data (US$ in thousands)
Cash and cash equivalents
Marketable securities and other investments
Total cash assets
 
Current liabilities
Liquidity Ratio
Cash ratio1
Benchmarks
Cash Ratio, Competitors2
Boeing Co.
Caterpillar Inc.
Eaton Corp. plc
GE Aerospace
Honeywell International Inc.
Lockheed Martin Corp.
RTX Corp.
Cash Ratio, Sector
Capital Goods
Cash Ratio, Industry
Industrials

Based on: 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30).

1 2022 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =

2 Click competitor name to see calculations.

Total Cash Assets
The total cash assets exhibited significant fluctuation over the analyzed periods. Initially, the cash assets decreased from approximately 924 million USD in mid-2017 to about 855 million USD in mid-2018. An exceptional increase occurred in mid-2019, with cash assets peaking at around 3.37 billion USD. However, this peak was not sustained, as cash assets substantially declined to approximately 756 million USD in mid-2020. Subsequent years saw slightly increasing levels in mid-2021, reaching around 772 million USD, before dropping again to roughly 564 million USD by mid-2022.
Current Liabilities
Current liabilities demonstrated a relatively stable trend from mid-2017 through mid-2021, ranging between approximately 3.1 billion USD and 3.4 billion USD, with a marginal downward tendency. In striking contrast, by mid-2022, current liabilities more than doubled, reaching approximately 5.86 billion USD, indicating a significant increase in short-term obligations during this period.
Cash Ratio
The cash ratio, reflecting the company's ability to cover current liabilities with cash assets, experienced considerable volatility. It remained steady at 0.27 in mid-2017 and mid-2018 before rising sharply to 1.07 in mid-2019, coinciding with the peak in cash assets. This was followed by a steep decline to 0.24 in mid-2020 and only slight improvements to 0.25 in mid-2021. By mid-2022, the cash ratio deteriorated further to 0.10, indicating a reduced liquidity position relative to current liabilities.
Overall Analysis
The data reveal a pattern of considerable liquidity fluctuations, with a notable cash asset spike in mid-2019 not sustained in subsequent years. Despite relatively stable current liabilities for most of the period, a significant surge in liabilities was observed in mid-2022, which, coupled with declining cash assets, resulted in a marked deterioration in liquidity as evidenced by the low cash ratio. This suggests increasing short-term financial pressure and a potential need for improved cash management or financing strategies.