Investors have an uncanny knack for swinging between worrying about nothing and worrying about everything. In the case of Parker-Hannifin (PH),
it would seem that poorly-communicated, near-term margin issues are
disappointing investors who favor margin improvement stories within the
multi-industrial space, while worries about where Parker-Hannifin sits
in the short-/mid-/late-cycle ecosystem are troubling other investors.
Although
I do have some concerns about growth with Parker-Hannifin, I think the
stock's valuation is interesting on both an absolute and relative basis,
particularly given acceleration in orders and high valuations in the
peer group. To me, the shares look priced for high-single-digit to
low-double-digit total returns, and you could make an argument that a
fair value in the $220s or $230s wouldn't be ridiculous.
Read the full article:
Is It Too Late For An Early-Cycle Name Like Parker Hannifin?
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