Price to Sales (P/S)
since 2005
Calculation
Parker-Hannifin Corp., P/S, long-term trends, calculation
| P/S | = | Share price1, 2, 3 | ÷ | Sales per share1 | Sales per share1 | = | Net sales1 (in thousands) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Aug 24, 2022 | 2.31 | = | 285.40 | ÷ | 123.53 | 123.53 | = | 15,861,608 | ÷ | 128,402,997 | |
| Aug 25, 2021 | 2.73 | = | 303.51 | ÷ | 111.13 | 111.13 | = | 14,347,640 | ÷ | 129,101,437 | |
| Aug 26, 2020 | 1.97 | = | 209.78 | ÷ | 106.53 | 106.53 | = | 13,695,520 | ÷ | 128,561,616 | |
| Aug 23, 2019 | 1.42 | = | 158.03 | ÷ | 111.49 | 111.49 | = | 14,320,324 | ÷ | 128,441,799 | |
| Aug 24, 2018 | 1.59 | = | 171.53 | ÷ | 108.06 | 108.06 | = | 14,302,392 | ÷ | 132,360,024 | |
| Aug 25, 2017 | 1.74 | = | 157.30 | ÷ | 90.36 | 90.36 | = | 12,029,312 | ÷ | 133,129,936 | |
| Aug 26, 2016 | 1.45 | = | 123.24 | ÷ | 84.84 | 84.84 | = | 11,360,753 | ÷ | 133,901,044 | |
| Aug 26, 2015 | 1.12 | = | 103.08 | ÷ | 91.84 | 91.84 | = | 12,711,744 | ÷ | 138,418,792 | |
| Aug 22, 2014 | 1.31 | = | 116.15 | ÷ | 88.82 | 88.82 | = | 13,215,971 | ÷ | 148,795,701 | |
| Aug 29, 2013 | 1.16 | = | 100.80 | ÷ | 87.25 | 87.25 | = | 13,015,704 | ÷ | 149,179,343 | |
| Aug 24, 2012 | 0.93 | = | 81.58 | ÷ | 87.97 | 87.97 | = | 13,145,942 | ÷ | 149,443,661 | |
| Aug 26, 2011 | 0.85 | = | 67.70 | ÷ | 79.62 | 79.62 | = | 12,345,870 | ÷ | 155,061,050 | |
| Aug 26, 2010 | 0.97 | = | 59.85 | ÷ | 62.00 | 62.00 | = | 9,993,166 | ÷ | 161,176,153 | |
| Aug 27, 2009 | 0.77 | = | 49.68 | ÷ | 64.22 | 64.22 | = | 10,309,015 | ÷ | 160,517,563 | |
| Aug 28, 2008 | 0.90 | = | 65.01 | ÷ | 72.46 | 72.46 | = | 12,145,605 | ÷ | 167,629,211 | |
| Aug 29, 2007 | 1.15 | = | 70.60 | ÷ | 61.51 | 61.51 | = | 10,718,059 | ÷ | 174,253,272 | |
| Sep 6, 2006 | 0.96 | = | 49.88 | ÷ | 52.05 | 52.05 | = | 9,385,888 | ÷ | 180,324,062 | |
| Sep 2, 2005 | 0.94 | = | 42.97 | ÷ | 45.76 | 45.76 | = | 8,215,095 | ÷ | 179,530,578 |
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$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of Parker-Hannifin Corp. Annual Report.
The Price-to-Sales (P/S) ratio demonstrates a marked long-term expansion from 2005 to 2022. While the ratio remained relatively suppressed for the first several years of the observed period, there is a clear shift toward higher valuation multiples in the latter decade, with a particularly sharp acceleration occurring after 2019.
- Early Period Stability (2005–2012)
- During this interval, the P/S ratio fluctuated primarily between 0.77 and 1.15. A notable trough occurred in 2009, where the ratio reached its lowest point of 0.77, coinciding with a contraction in both share price and sales per share. Throughout this phase, the market generally valued the company at or near its annual sales per share, indicating a conservative valuation environment.
- Intermediate Valuation Shift (2013–2018)
- A transition toward higher multiples began in 2013, with the P/S ratio consistently exceeding 1.10. By 2017, the ratio reached 1.74, reflecting a divergence where share price growth began to outpace the growth in sales per share. This period indicates an increase in the market's willingness to pay a premium for the company's revenue streams, suggesting improved margin expectations or increased investor confidence.
- Recent Valuation Acceleration (2019–2022)
- The most significant expansion in the P/S ratio occurred between 2019 and 2021. The ratio climbed from 1.42 to a peak of 2.73 in 2021. This spike represents a substantial re-rating of the equity, as the share price increased more aggressively than the underlying sales per share. A slight correction followed in 2022, with the ratio settling at 2.31, though it remains significantly elevated compared to the historical averages of the preceding decade.
- Relationship between Share Price and Revenue Growth
- The expansion of the P/S ratio is driven by the widening gap between share price appreciation and sales per share growth. While sales per share grew from 45.76 in 2005 to 123.53 in 2022, the share price rose from 42.97 to 285.40. The fact that the share price grew at a significantly faster rate than the sales per share confirms that the increase in the P/S ratio is a result of multiple expansion rather than organic revenue growth alone.
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Comparison to Competitors
Parker-Hannifin Corp., P/S, 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. | |
|---|---|---|---|---|---|---|---|---|
| Aug 24, 2022 | 2.31 | 1.90 | 2.27 | 3.31 | 1.20 | 3.78 | 1.78 | 2.14 |
| Aug 25, 2021 | 2.73 | 1.87 | 2.26 | 3.03 | 1.50 | 3.73 | 1.57 | 2.21 |
| Aug 26, 2020 | 1.97 | 1.96 | 2.83 | 2.96 | 1.41 | 4.34 | 1.40 | 1.95 |
| Aug 23, 2019 | 1.42 | 2.34 | 1.48 | 1.87 | 1.18 | 3.51 | 2.07 | 1.75 |
| Aug 24, 2018 | 1.59 | 2.26 | 1.47 | 1.58 | 0.82 | 2.59 | 1.58 | 1.56 |
| Aug 25, 2017 | 1.74 | 2.17 | 2.24 | 1.74 | 1.11 | 2.74 | 1.91 | 1.67 |
| Aug 26, 2016 | 1.45 | 1.06 | 1.62 | 1.65 | 2.39 | 2.36 | 1.59 | 1.55 |
| Aug 26, 2015 | 1.12 | 0.80 | 0.86 | 1.25 | 2.59 | 2.06 | 1.43 | 1.26 |
| Aug 22, 2014 | 1.31 | 1.15 | 0.99 | 1.49 | 2.45 | 2.03 | 1.34 | 1.67 |
| Aug 29, 2013 | 1.16 | 1.12 | 1.17 | 1.63 | 2.54 | 1.90 | 1.15 | 1.60 |
| Aug 24, 2012 | 0.93 | 0.70 | 0.99 | 1.79 | 2.39 | 1.46 | 0.60 | 1.43 |
| Aug 26, 2011 | 0.85 | 0.82 | 1.30 | 1.08 | 2.15 | 1.28 | 0.62 | 1.31 |
| Aug 26, 2010 | 0.97 | 0.83 | 1.63 | 1.33 | 2.20 | 1.36 | 0.61 | 1.44 |
| Aug 27, 2009 | 0.77 | 0.64 | 1.23 | 0.95 | 1.66 | 0.94 | 0.64 | 1.19 |
| Aug 28, 2008 | 0.90 | 0.51 | 0.33 | 0.39 | 1.02 | 0.66 | 0.64 | 0.77 |
| Aug 29, 2007 | 1.15 | 0.98 | 1.06 | 0.91 | 3.45 | 1.21 | 1.03 | 1.30 |
| Sep 6, 2006 | 0.96 | 1.17 | 1.12 | 0.96 | 3.54 | 1.22 | 1.08 | 1.44 |
| Sep 2, 2005 | 0.94 | 1.06 | 1.44 | 0.93 | 3.72 | 1.24 | 0.86 | 1.36 |
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., P/S, long-term trends, comparison to sector (capital goods)
| Parker-Hannifin Corp. | Capital Goods | |
|---|---|---|
| Aug 24, 2022 | 2.31 | 2.09 |
| Aug 25, 2021 | 2.73 | 2.09 |
| Aug 26, 2020 | 1.97 | 2.11 |
| Aug 23, 2019 | 1.42 | 1.92 |
| Aug 24, 2018 | 1.59 | 1.62 |
| Aug 25, 2017 | 1.74 | 1.82 |
| Aug 26, 2016 | 1.45 | 1.76 |
| Aug 26, 2015 | 1.12 | 1.55 |
| Aug 22, 2014 | 1.31 | 1.66 |
| Aug 29, 2013 | 1.16 | 1.66 |
| Aug 24, 2012 | 0.93 | 1.37 |
| Aug 26, 2011 | 0.85 | 1.33 |
| Aug 26, 2010 | 0.97 | 1.45 |
| Aug 27, 2009 | 0.77 | 1.12 |
| Aug 28, 2008 | 0.90 | 0.71 |
| Aug 29, 2007 | 1.15 | 1.76 |
| Sep 6, 2006 | 0.96 | 1.91 |
| Sep 2, 2005 | 0.94 | 1.95 |
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., P/S, long-term trends, comparison to industry (industrials)
| Parker-Hannifin Corp. | Industrials | |
|---|---|---|
| Aug 24, 2022 | 2.31 | 1.80 |
| Aug 25, 2021 | 2.73 | 2.07 |
| Aug 26, 2020 | 1.97 | 2.14 |
| Aug 23, 2019 | 1.42 | 1.77 |
| Aug 24, 2018 | 1.59 | 1.58 |
| Aug 25, 2017 | 1.74 | 1.71 |
| Aug 26, 2016 | 1.45 | 1.68 |
| Aug 26, 2015 | 1.12 | 1.48 |
| Aug 22, 2014 | 1.31 | 1.65 |
| Aug 29, 2013 | 1.16 | 1.57 |
| Aug 24, 2012 | 0.93 | 1.31 |
| Aug 26, 2011 | 0.85 | 1.27 |
| Aug 26, 2010 | 0.97 | 1.39 |
| Aug 27, 2009 | 0.77 | 1.09 |
| Aug 28, 2008 | 0.90 | 0.71 |
| Aug 29, 2007 | 1.15 | 1.62 |
| Sep 6, 2006 | 0.96 | 1.73 |
| Sep 2, 2005 | 0.94 | 1.80 |
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).