Debt to Equity
since 2005
Calculation
Parker-Hannifin Corp., debt to equity, long-term trends, calculation
| Debt to equity | = | Notes payable and long-term debt1 | ÷ | Shareholders’ equity1 | |
|---|---|---|---|---|---|
| Jun 30, 2022 | 1.30 | = | 11,480,135) | ÷ | 8,848,011) |
| Jun 30, 2021 | 0.78 | = | 6,584,877) | ÷ | 8,398,307) |
| Jun 30, 2020 | 1.38 | = | 8,461,785) | ÷ | 6,113,983) |
| Jun 30, 2019 | 1.19 | = | 7,107,845) | ÷ | 5,961,969) |
| Jun 30, 2018 | 0.85 | = | 4,957,025) | ÷ | 5,859,866) |
| Jun 30, 2017 | 1.12 | = | 5,870,360) | ÷ | 5,261,649) |
| Jun 30, 2016 | 0.66 | = | 3,036,840) | ÷ | 4,575,255) |
| Jun 30, 2015 | 0.58 | = | 2,947,102) | ÷ | 5,104,287) |
| Jun 30, 2014 | 0.35 | = | 2,324,764) | ÷ | 6,659,428) |
| Jun 30, 2013 | 0.49 | = | 2,829,786) | ÷ | 5,738,426) |
| Jun 30, 2012 | 0.35 | = | 1,729,535) | ÷ | 4,896,515) |
| Jun 30, 2011 | 0.33 | = | 1,766,357) | ÷ | 5,383,854) |
| Jun 30, 2010 | 0.41 | = | 1,776,906) | ÷ | 4,367,965) |
| Jun 30, 2009 | 0.54 | = | 2,321,172) | ÷ | 4,279,625) |
| Jun 30, 2008 | 0.39 | = | 2,071,316) | ÷ | 5,258,971) |
| Jun 30, 2007 | 0.27 | = | 1,285,300) | ÷ | 4,711,665) |
| Jun 30, 2006 | 0.27 | = | 1,131,500) | ÷ | 4,241,203) |
| Jun 30, 2005 | 0.29 | = | 970,386) | ÷ | 3,340,147) |
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), 10-K (reporting date: 2016-06-30), 10-K (reporting date: 2015-06-30), 10-K (reporting date: 2014-06-30), 10-K (reporting date: 2013-06-30), 10-K (reporting date: 2012-06-30), 10-K (reporting date: 2011-06-30), 10-K (reporting date: 2010-06-30), 10-K (reporting date: 2009-06-30), 10-K (reporting date: 2008-06-30), 10-K (reporting date: 2007-06-30), 10-K (reporting date: 2006-06-30), 10-K (reporting date: 2005-06-30).
1 US$ in thousands
An analysis of the capital structure from 2005 to 2022 reveals a significant long-term shift toward increased financial leverage. While a conservative debt-to-equity profile was maintained for the first decade of the period, the subsequent years are characterized by a substantial increase in long-term debt relative to shareholders' equity.
- Debt Accumulation Trends
- Total notes payable and long-term debt experienced exponential growth, rising from approximately $970 million in 2005 to over $11.48 billion by 2022. A notable acceleration occurred after 2016, where debt levels nearly doubled between 2016 and 2017, jumping from $3.04 billion to $5.87 billion. This upward trajectory continued with significant peaks in 2019 and 2022.
- Shareholders' Equity Evolution
- Equity grew steadily from $3.34 billion in 2005 to $8.85 billion in 2022. However, the growth of equity did not keep pace with the rapid expansion of debt. Fluctuations are observed between 2014 and 2016, where equity declined from $6.66 billion to $4.58 billion before resuming a general upward trend.
- Debt-to-Equity Ratio Analysis
- The debt-to-equity ratio remained relatively low and stable between 2005 and 2012, fluctuating primarily between 0.27 and 0.54. A structural shift in leverage began in 2017, when the ratio exceeded 1.0 for the first time, reaching 1.12. The ratio peaked at 1.38 in 2020, indicating a period where total debt significantly outweighed equity. Despite a sharp correction to 0.78 in 2021, the ratio returned to a high of 1.30 by 2022.
- Capital Structure Correlation
- The divergence between debt and equity growth is most prominent after 2016. The increase in the debt-to-equity ratio suggests a strategic transition toward a more aggressive financing model, utilizing greater amounts of borrowed capital to fund operations or acquisitions compared to the equity-heavy approach used in the mid-2000s.
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Comparison to Competitors
Parker-Hannifin Corp., debt to equity, long-term trends, comparison to competitors
| Parker-Hannifin Corp. | Boeing Co. | Caterpillar Inc. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | |
|---|---|---|---|---|---|---|---|---|
| Jun 30, 2022 | 1.30 | — | 2.33 | 0.51 | 0.89 | 1.17 | 1.68 | 0.44 |
| Jun 30, 2021 | 0.78 | — | 2.29 | 0.52 | 0.87 | 1.06 | 1.07 | 0.43 |
| Jun 30, 2020 | 1.38 | — | 2.42 | 0.54 | 2.11 | 1.28 | 2.02 | 0.44 |
| Jun 30, 2019 | 1.19 | — | 2.58 | 0.52 | 3.21 | 0.87 | 4.05 | 1.04 |
| Jun 30, 2018 | 0.85 | 40.85 | 2.60 | 0.47 | 3.55 | 0.89 | 9.04 | 1.18 |
| Jun 30, 2017 | 1.12 | 31.32 | 2.55 | 0.45 | 2.09 | 1.04 | — | 0.93 |
| Jun 30, 2016 | 0.66 | 12.18 | 2.80 | 0.56 | 1.80 | 0.81 | 9.45 | 0.87 |
| Jun 30, 2015 | 0.58 | 1.57 | 2.57 | 0.56 | 2.02 | 0.66 | 4.62 | 0.75 |
| Jun 30, 2014 | 0.35 | 1.05 | 2.35 | 0.57 | 2.85 | 0.49 | 1.81 | 0.63 |
| Jun 30, 2013 | 0.49 | 0.65 | 1.81 | 0.57 | 2.93 | 0.51 | 1.25 | 0.64 |
| Jun 30, 2012 | 0.35 | 1.77 | 2.29 | 0.72 | 3.37 | 0.58 | 157.90 | 0.90 |
| Jun 30, 2011 | 0.33 | 3.52 | 2.69 | 0.51 | 3.89 | 0.70 | 6.45 | 0.47 |
| Jun 30, 2010 | 0.41 | 4.49 | 2.63 | 0.47 | 4.02 | 0.62 | 1.35 | 0.48 |
| Jun 30, 2009 | 0.54 | 6.07 | 3.62 | 0.51 | 4.35 | 0.86 | 1.22 | 0.49 |
| Jun 30, 2008 | 0.39 | — | 5.84 | 0.68 | 5.00 | 1.17 | 1.24 | 0.72 |
| Jun 30, 2007 | 0.27 | 0.91 | 3.20 | 0.66 | 4.45 | 0.83 | 0.44 | 0.43 |
| Jun 30, 2006 | 0.27 | 2.01 | 3.98 | 0.63 | 3.85 | 0.52 | 0.64 | 0.46 |
| Jun 30, 2005 | 0.29 | 0.97 | 3.05 | 0.65 | 3.39 | 0.45 | 0.61 | 0.48 |
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), 10-K (reporting date: 2016-06-30), 10-K (reporting date: 2015-06-30), 10-K (reporting date: 2014-06-30), 10-K (reporting date: 2013-06-30), 10-K (reporting date: 2012-06-30), 10-K (reporting date: 2011-06-30), 10-K (reporting date: 2010-06-30), 10-K (reporting date: 2009-06-30), 10-K (reporting date: 2008-06-30), 10-K (reporting date: 2007-06-30), 10-K (reporting date: 2006-06-30), 10-K (reporting date: 2005-06-30).
Comparison to Sector (Capital Goods)
Parker-Hannifin Corp., debt to equity, long-term trends, comparison to sector (capital goods)
| Parker-Hannifin Corp. | Capital Goods | |
|---|---|---|
| Jun 30, 2022 | 1.30 | 1.33 |
| Jun 30, 2021 | 0.78 | 1.26 |
| Jun 30, 2020 | 1.38 | 1.75 |
| Jun 30, 2019 | 1.19 | 2.08 |
| Jun 30, 2018 | 0.85 | 2.03 |
| Jun 30, 2017 | 1.12 | 1.74 |
| Jun 30, 2016 | 0.66 | 1.60 |
| Jun 30, 2015 | 0.58 | 1.64 |
| Jun 30, 2014 | 0.35 | 2.06 |
| Jun 30, 2013 | 0.49 | 2.00 |
| Jun 30, 2012 | 0.35 | 2.56 |
| Jun 30, 2011 | 0.33 | 3.04 |
| Jun 30, 2010 | 0.41 | 3.10 |
| Jun 30, 2009 | 0.54 | 3.46 |
| Jun 30, 2008 | 0.39 | 4.19 |
| Jun 30, 2007 | 0.27 | 3.21 |
| Jun 30, 2006 | 0.27 | 3.02 |
| Jun 30, 2005 | 0.29 | 2.53 |
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), 10-K (reporting date: 2016-06-30), 10-K (reporting date: 2015-06-30), 10-K (reporting date: 2014-06-30), 10-K (reporting date: 2013-06-30), 10-K (reporting date: 2012-06-30), 10-K (reporting date: 2011-06-30), 10-K (reporting date: 2010-06-30), 10-K (reporting date: 2009-06-30), 10-K (reporting date: 2008-06-30), 10-K (reporting date: 2007-06-30), 10-K (reporting date: 2006-06-30), 10-K (reporting date: 2005-06-30).
Comparison to Industry (Industrials)
Parker-Hannifin Corp., debt to equity, long-term trends, comparison to industry (industrials)
| Parker-Hannifin Corp. | Industrials | |
|---|---|---|
| Jun 30, 2022 | 1.30 | 1.42 |
| Jun 30, 2021 | 0.78 | 1.37 |
| Jun 30, 2020 | 1.38 | 1.82 |
| Jun 30, 2019 | 1.19 | 1.82 |
| Jun 30, 2018 | 0.85 | 1.85 |
| Jun 30, 2017 | 1.12 | 1.65 |
| Jun 30, 2016 | 0.66 | 1.54 |
| Jun 30, 2015 | 0.58 | 1.51 |
| Jun 30, 2014 | 0.35 | 1.89 |
| Jun 30, 2013 | 0.49 | 1.79 |
| Jun 30, 2012 | 0.35 | 2.29 |
| Jun 30, 2011 | 0.33 | 2.60 |
| Jun 30, 2010 | 0.41 | 2.68 |
| Jun 30, 2009 | 0.54 | 3.01 |
| Jun 30, 2008 | 0.39 | 3.54 |
| Jun 30, 2007 | 0.27 | 2.73 |
| Jun 30, 2006 | 0.27 | 2.49 |
| Jun 30, 2005 | 0.29 | 2.42 |
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), 10-K (reporting date: 2016-06-30), 10-K (reporting date: 2015-06-30), 10-K (reporting date: 2014-06-30), 10-K (reporting date: 2013-06-30), 10-K (reporting date: 2012-06-30), 10-K (reporting date: 2011-06-30), 10-K (reporting date: 2010-06-30), 10-K (reporting date: 2009-06-30), 10-K (reporting date: 2008-06-30), 10-K (reporting date: 2007-06-30), 10-K (reporting date: 2006-06-30), 10-K (reporting date: 2005-06-30).