Seeking Alpha

Parker Hannifin -3%, FY 2014 outlook at low end of consensus

  • Parker Hannifin (PH -3.1%) slides after FQ2 earnings rose 40% Y/Y and results were mostly in-line with estimates, but the company offered an EPS outlook for the year that was largely below forecast.
  • Overall orders rose 5% Y/Y in orders for the quarter: +3% in the Diversified Industrial North America businesses, +6% in the Diversified Industrial International businesses, +7% in the Aerospace Systems segment on a rolling 12-month average basis.
  • Gains from a joint venture agreement with GE offset a costly write-down.
  • Sees FY 2014 EPS of $6.20-$6.60, excluding non-recurring items, vs. $6.62 Capital IQ consensus estimate.
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Comments (1)
  • Buysider2
    , contributor
    Comments (265) | Send Message
     
    Contrary to the summary above, Parker's EPS guidance for the year was NOT "largely below forecast."

     

    Parker narrowed its EPS guidance for the full year to $6.20-to-6.60 from its prior guidance of $6.10-to-6.70 at the end of the 1Q three months ago. The mid-point of $6.40 is UNCHANGED.

     

    That guidance range brackets the consensus of $6.57 and is IN LINE with Parker's prior forecast, NOT below it.

     

    Moreover, to complain that the continuing $6.40 mid-point of Parker's guidance is below the $6.57 consensus is to assign significantly more importance and weight to analysts' forecasts than those forecasts deserve.

     

    In this instance, compared with the UNCHANGED mid-point Parker's guidance, it was the ANALYSTS who missed and not the company! The analysts apparently did not listen, but went off on their own.
    22 Jan 2014, 12:33 PM Reply Like
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