Parker-Hannifin Corporation (PH)

Activity ratios

Short-term

Turnover ratios

	Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Inventory turnover	4.42	4.58	4.33	5.18	5.00
Receivables turnover	6.15	6.23	6.08	5.50	5.72
Payables turnover	5.90	6.41	6.15	6.63	6.26
Working capital turnover	17.55	—	—	2.56	5.69

The activity ratios of Parker-Hannifin Corporation, as reflected in the provided data, exhibit notable trends over the fiscal years ending June 30, 2021, through June 30, 2025.

Inventory Turnover:
The ratio demonstrates a slight increase from 5.00 times in 2021 to 5.18 in 2022, indicating a modest improvement in inventory management efficiency during that period. However, a decline is observed in 2023, where the turnover drops to 4.33, suggesting slower inventory sales or accumulation of inventory. This ratio then modestly rebounds to 4.58 in 2024, followed by a slight decrease to 4.42 in 2025, reflecting fluctuations in inventory management efficiency.

Receivables Turnover:
The receivables turnover ratio shows a generally upward trend, rising from 5.72 times in 2021 to 6.08 in 2023, indicating improving collection efficiency and shorter average collection periods. It continues to slightly increase to 6.23 in 2024 before stabilizing at 6.15 in 2025, maintaining relatively strong receivables management.

Payables Turnover:
During the reviewed period, the payables turnover ratio fluctuates mildly. It increased from 6.26 in 2021 to 6.63 in 2022, indicating accelerated payments to suppliers or shorter payment periods. Subsequently, it decreased to 6.15 in 2023 and slightly increased again to 6.41 in 2024. A decrease to 5.90 is observed in 2025, implying a slight extension in the period taken to settle payables, potentially impacting relationships with suppliers or reflecting strategic payment practices.

Working Capital Turnover:
This ratio displays considerable variability. It sharply declines from 5.69 in 2021 to 2.56 in 2022, which may suggest decreased efficiency in utilizing working capital during that year. Data for 2023 and 2024 are unavailable, limiting trend analysis for those years. However, a significant increase to 17.55 is observed in 2025, implying an enhanced efficiency in converting working capital into sales.

Overall, these activity ratios depict a pattern of fluctuating operational efficiency across the analyzed period, with some metrics improving while others experience declines or volatility, reflected particularly by inventory and working capital turnover ratios.

Average number of days

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Days of inventory on hand (DOH)	days	82.67	79.64	84.20	70.44	73.07
Days of sales outstanding (DSO)	days	59.36	58.55	60.05	66.39	63.85
Number of days of payables	days	61.91	56.92	59.39	55.09	58.30

The activity ratios for Parker-Hannifin Corporation, encompassing the days of inventory on hand, days of sales outstanding, and days of payables, demonstrate certain trends over the period from June 30, 2021, through June 30, 2025.

Days of Inventory on Hand (DOH):
The DOH metric indicates the average number of days inventory remains unsold before being converted into sales. The data shows a slight decrease from 73.07 days in 2021 to 70.44 days in 2022, suggesting a marginal improvement in inventory turnover. However, starting in 2023, there is a notable increase to 84.20 days, signifying that inventory is being held longer, which could reflect increased stockpiling or slower sales. While there is a subsequent slight reduction in 2024 to 79.64 days, the value remains higher than the 2022 figure, and by 2025, the DOH increases again to 82.67 days. Overall, the pattern indicates periods of inventory accumulation, which could impact liquidity and operational efficiency.

Days of Sales Outstanding (DSO):
This ratio measures the average number of days it takes to collect receivables. An initial increase from 63.85 days in 2021 to 66.39 days in 2022 suggests a slight slowdown in collections. Notably, there is a significant decrease to 60.05 days in 2023, pointing towards improved receivables management. The subsequent decline continues slightly in 2024 to 58.55 days, with a minor rise to 59.36 days in 2025. The trend reflects periods of enhanced credit collection efficiency, contributing positively to cash flow management.

Number of Days of Payables:
This ratio indicates the average number of days the company takes to pay its suppliers. An increase from 58.30 days in 2021 to 59.39 days in 2023 suggests a tendency towards extending payment periods, potentially optimizing working capital. However, in 2024, the number decreases to 56.92 days, implying a slight tightening of payment terms, before increasing again to 61.91 days in 2025, indicating a strategic extension of payables. This fluctuation could be associated with company liquidity strategies or supplier negotiations.

Summary:
Throughout the analyzed period, Parker-Hannifin's activity ratios reveal a pattern of inventory accumulation commenced around 2023, coupled with improvements in receivables collection. The changes in payables suggest active management of payment terms, with periods of extension and tightening. These trends collectively highlight shifts in operational efficiency and working capital management that warrant ongoing monitoring to assess their impact on overall financial health.

Long-term

	Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Fixed asset turnover	—	6.43	6.65	7.47	6.33
Total asset turnover	0.67	0.68	0.64	0.61	0.71

The long-term activity ratios of Parker-Hannifin Corporation, specifically the Fixed Asset Turnover and Total Asset Turnover ratios, demonstrate certain trends over the analyzed fiscal periods.

The Fixed Asset Turnover ratio reveals fluctuations over the period from June 30, 2021, to June 30, 2024. Initially, there is an increase from 6.33 in 2021 to a peak of 7.47 in 2022, suggesting improved efficiency in utilizing fixed assets to generate sales during that year. However, this ratio declines slightly in subsequent years, decreasing to 6.65 in 2023 and further to 6.43 in 2024, indicating a potential waning in fixed asset utilization efficiency or expansion of fixed assets not yet fully translated into proportionate sales.

The Total Asset Turnover ratio exhibits a downward trend from 0.71 in 2021 to 0.61 in 2022, reflecting a decrease in the overall efficiency of asset utilization across the firm during that period. Following this decline, the ratio shows a marginal recovery and stabilization, rising to 0.64 in 2023 and reaching 0.68 in 2024, ultimately nearing the initial levels observed in 2021. This pattern may point to improvements in total asset management or operational efficiency, though it remains below the 2021 level, indicating room for further improvement.

Overall, the data suggest that Parker-Hannifin's fixed asset efficiency experienced a short-term peak followed by a gradual decline, whereas the total asset utilization ratio demonstrates some recovery after a decline, trending toward stabilization. These movements could reflect strategic asset management decisions, operational efficiencies, or expansion efforts that impact the company’s ability to generate sales relative to its invested assets over the analyzed period.