10 Best Industrial Machinery Stocks to Buy Now

2. Parker-Hannifin Corporation (NYSE:PH)

Number of Hedge Fund Holders: 67

Parker-Hannifin Corporation (NYSE:PH) is an industrial company that operates in two segments: aerospace systems, which provide engine and actuation components, and diversified industrial, which serves a range of end markets.

Parker-Hannifin Corporation (NYSE:PH) offers an exposure to a wide range of end markets. Following its most recent Win Strategy and major acquisitions of Clarcor, Lord, Exotic Metals, and Meggitt, Morningstar analysts think that the company can eventually surpass industrial production and increase its margin. Pneumatics and hydraulics, fluid and gas handling, and sealing are just a few of the many uses for Parker’s extensive range of motion and control technologies. Parker claims that around 85% of the revenue from these technologies is protected by intellectual property, which experts feel helps to solidify its competitive position given the business’s extended product lifecycles and low reinvestment demands.

Through its acquisitions, Parker-Hannifin Corporation (NYSE:PH) was able to add innovations in areas like vibration, tailored materials, and filtration that significantly complemented its current offering. The company doubles down on long-cycle operations and strengthens its position in the very desirable higher-margin aftermarket with these purchases.

The company announced solid results in its fiscal 2025 first quarter due to strong aerospace demand. The revenue grew by 1.17% YoY. Notably, with an adjusted margin of 25.7%, the segment operating margin hit a record high. Furthermore, operating cash flow increased 14% YoY to $744 million.

Parker-Hannifin Corporation (NYSE:PH) anticipates that overall sales growth in fiscal 2025 will be between 0.5% and 3.5%, with organic growth falling between 1.5% and 4.5%. Earnings per share are expected to increase, showing the company’s confidence in its strategic direction and market position.

Madison Investors Fund stated the following regarding Parker-Hannifin Corporation (NYSE:PH) in its Q3 2024 investor letter:

“In the third quarter, the top five individual contributors to performance relative to the benchmark were Parker-Hannifin Corporation (NYSE:PH), Fiserv, Lowe’s Companies, Brookfield Corporation, and Progressive Corporation. Parker-Hannifin is a leading diversified industrial manufacturer. Despite the unfavorable backdrop of a slowing industrial economy, the company continues to execute well with respect to improving margins and integrating the recent acquisition of Meggitt.”

Ric Dillon’s Diamond Hill Capital is the largest stakeholder in the company among the funds in Insider Monkey’s database. It owns 803,843 shares worth $507.88 million as of Q2.