Head to Head Comparison: Parker Hannifin (PH) vs. Sun Hydraulics (SNHY)

Parker Hannifin (NYSE: PH) and Sun Hydraulics (NASDAQ:SNHY) are both industrial products companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.

Dividends

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Parker Hannifin pays an annual dividend of $2.64 per share and has a dividend yield of 1.5%. Sun Hydraulics pays an annual dividend of $0.36 per share and has a dividend yield of 0.7%. Parker Hannifin pays out 32.6% of its earnings in the form of a dividend. Sun Hydraulics pays out 22.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Volatility and Risk

Parker Hannifin has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500. Comparatively, Sun Hydraulics has a beta of 1.66, meaning that its stock price is 66% more volatile than the S&P 500.

Earnings and Valuation

This table compares Parker Hannifin and Sun Hydraulics’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Parker Hannifin $12.03 billion 1.91 $983.41 million $8.11 21.27
Sun Hydraulics $342.84 million 4.91 $31.55 million $1.60 33.38

Parker Hannifin has higher revenue and earnings than Sun Hydraulics. Parker Hannifin is trading at a lower price-to-earnings ratio than Sun Hydraulics, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Parker Hannifin and Sun Hydraulics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Parker Hannifin 0 7 8 0 2.53
Sun Hydraulics 0 1 5 0 2.83

Parker Hannifin currently has a consensus target price of $199.13, suggesting a potential upside of 15.45%. Sun Hydraulics has a consensus target price of $63.00, suggesting a potential upside of 17.96%. Given Sun Hydraulics’ stronger consensus rating and higher probable upside, analysts plainly believe Sun Hydraulics is more favorable than Parker Hannifin.

Profitability

This table compares Parker Hannifin and Sun Hydraulics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Parker Hannifin 6.54% 23.15% 7.80%
Sun Hydraulics 9.20% 16.58% 9.34%

Institutional & Insider Ownership

81.6% of Parker Hannifin shares are owned by institutional investors. Comparatively, 70.1% of Sun Hydraulics shares are owned by institutional investors. 1.1% of Parker Hannifin shares are owned by insiders. Comparatively, 10.0% of Sun Hydraulics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Sun Hydraulics beats Parker Hannifin on 9 of the 16 factors compared between the two stocks.

About Parker Hannifin

Parker-Hannifin Corporation manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. The company operates in two segments, Diversified Industrial and Aerospace Systems. The Diversified Industrial segment provides static and dynamic sealing devices; filters, systems, and diagnostics solutions to monitor and remove contaminants from fuel, air, oil, water, and other liquids and gases; connectors, which control, transmit, and contain fluid; hydraulic, pneumatic, and electromechanical components and systems for builders and users of industrial and mobile machinery and equipment; and critical flow components for process instrumentation, healthcare, and ultra-high-purity applications, as well as components for use in refrigeration and air conditioning systems, and in fluid control applications for processing, fuel dispensing, beverage dispensing, and mobile emissions. This segment sells its products to original equipment manufacturers and their replacement markets in manufacturing, packaging, processing, transportation, mobile construction, refrigeration and air conditioning, agricultural, and military machinery and equipment industries. The Aerospace Systems segment offers products for use in commercial and military airframe and engine programs, including control actuation systems and components, engine systems and components, fluid conveyance systems and components, fuel systems and components, fuel tank inserting systems, hydraulic systems and components, lubrication components, pneumatic control components, power conditioning and management systems, thermal management products, and wheels and brakes. This segment markets its products directly to original equipment manufacturers and end users. The company markets its products through direct-sales employees, independent distributors, and sales representatives. Parker-Hannifin Corporation was founded in 1918 and is headquartered in Cleveland, Ohio.

About Sun Hydraulics

Sun Hydraulics Corporation designs, manufactures, and sells screw-in hydraulic cartridge valves, manifolds, and integrated fluid power packages and subsystems used in hydraulic systems worldwide. The company operates through two segments, Hydraulics and Electronics. Its screw-in hydraulic cartridge valves and manifolds control force, speed, and motion as integral components in fluid power systems. The company offers various screw-in hydraulic cartridge valves, including electrically actuated and non-electrically actuated products; electro-hydraulics; manifolds that are machined to create threaded cavities and channels; and integrated package solutions, which consists of multiple cartridge valves assembled into a custom designed manifolds for industrial and mobile hydraulics markets under the Sun Hydraulics brand name. It also designs and manufactures electronic control, display, and instrumentation solutions for recreational and off-highway vehicles, and stationary and power generation equipment under the Enovation Controls, Murphy, and Zero Off brand names; and digital and analog electronic controller products for the fluid power industry under the HCT brand name. The company sells its hydraulic products primarily through independent fluid power channel partners, as well as directly to original equipment manufacturer customers and other companies in the hydraulics industry; and electronic products to original equipment manufacturer customers. Sun Hydraulics Corporation was founded in 1970 and is headquartered in Sarasota, Florida.

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