Strength in Aerospace Systems Drives Parker-Hannifin: Will the Momentum Last?

Parker-Hannifin Corporation PH is witnessing strong momentum in its Aerospace Systems segment. The segment is benefiting from strength in commercial and military end markets across both Original Equipment Manufacturer (OEM) and aftermarket channels. Segmental revenues jumped approximately 13% year over year in fiscal 2025 (ended June 2025).

In the quarters ahead, the Aerospace Systems segment is poised to gain from strong demand for its products and aftermarket support services in the general aviation market, driven by growth in air transport activities. Strength in its defense end market, owing to stable U.S. and international defense spending volumes, is also likely to be beneficial. 

Parker-Hannifin expects the Aerospace Systems segment’s organic sales to increase approximately 8% from the year-ago level in fiscal 2026 (ending June 2026). In addition to growth in the aerospace and defense markets, key trends in other end markets hold promise for long-term growth. These include the advancement of clean technologies in support of carbon reduction targets, higher automation and infrastructure investments, digitalization and electrification.

Driven by strength in the Aerospace Systems segment, PH has issued bullish fiscal 2026 guidance. The company currently expects total sales to increase 2-5% year over year, while organic sales are projected to grow 1.5-4.5%.

Segment Snapshot of PH’s Peers

Among its major peers, Howmet Aerospace Inc. HWM is gaining momentum backed by the persistent strength in its defense aerospace market. In the second quarter of 2025, Howmet’s revenues from the defense aerospace market jumped 21% year over year, which accounted for 17% of its total sales. The surge in Howmet’s revenues was fueled by robust demand for engine spares, particularly related to the F-35 program and an increase in orders for new builds and legacy fighter jet parts.

Another peer, RBC Bearings Incorporated RBC is benefiting from solid demand in the aerospace and defense markets. Strength in the commercial aerospace market, driven by strong growth in orders from the OEM (original equipment manufacturer) and the aftermarket verticals, is driving RBC Bearings’ Aerospace/Defense segment. Revenues from the RBC segment increased 10.4% year over year in first-quarter fiscal 2026 (ended June 28, 2025).

PH's Price Performance, Valuation and Estimates

Shares of Parker-Hannifin have surged 24.6% in the past year compared with the industry’s growth of 5.1%.

From a valuation standpoint, PH is trading at a forward price-to-earnings ratio of 25.48X, above the industry’s average of 21.10X. Parker-Hannifin carries a Value Score of D.

The Zacks Consensus Estimate for PH’s fiscal 2026 earnings has inched up 0.6% over the past 60 days.

Parker-Hannifin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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