Parker-Hannifin Corporation (PH)

Cash ratio

		Jun 30, 2025	Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020
Cash and cash equivalents	US$ in thousands	467,000	408,735	395,507	371,068	422,027	405,484	382,815	448,926	475,182	534,831	756,055	502,307	535,799	467,711	449,481	478,582	733,117	489,600	564,734	742,394
Short-term investments	US$ in thousands	—	—	—	—	—	9,968	11,053	7,930	8,390	23,466	21,611	19,504	27,862	38,561	40,511	40,160	39,116	40,270	43,314	33,463
Total current liabilities	US$ in thousands	5,819,000	5,614,470	5,987,290	7,338,030	7,313,310	7,994,370	7,497,070	7,667,060	7,735,370	5,788,170	5,703,400	5,498,710	5,859,320	5,406,660	5,257,490	3,283,240	3,096,500	3,036,650	3,207,080	3,328,220
Cash ratio		0.08	0.07	0.07	0.05	0.06	0.05	0.05	0.06	0.06	0.10	0.14	0.09	0.10	0.09	0.09	0.16	0.25	0.17	0.19	0.23

June 30, 2025 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($467,000K + $—K) ÷ $5,819,000K
= 0.08

The provided data illustrates the evolution of Parker-Hannifin Corporation’s cash ratio over a series of quarters spanning from September 2020 through June 2025. The cash ratio, which measures a company's ability to meet its short-term obligations using only cash and cash equivalents, remains relatively low throughout this period, oscillating within a narrow range indicative of conservative liquidity management.

Initially, at the end of September 2020, the cash ratio stood at 0.23, suggesting that the company held approximately 23 cents in cash and cash equivalents for every dollar of current liabilities. This level decreased sharply over the subsequent months, reaching 0.19 by the end of December 2020 and progressively falling to 0.17 by March 2021. The ratio then experienced a slight increase in June 2021, rising to 0.25, which may reflect a temporary enhancement in cash holdings relative to current liabilities, before declining again to 0.16 in September 2021.

From late 2021 onward, the cash ratio depicted a declining trend, culminating in a low of 0.05 at the close of December 2023. During this period, fluctuations occurred, with modest increases to 0.07 in December 2024 and June 2025, though the ratio remained close to the lower bound of its historical range. Notably, the ratio hovered around 0.09 to 0.10 in the September 2022 and March 2023 quarters, indicating a persistent tendency to operate with limited cash relative to current liabilities.

Overall, the trend suggests that Parker-Hannifin has maintained a conservative liquidity posture, with the cash ratio typically below 0.10 in recent years. This pattern reflects strategic liquidity management, possibly relying on other liquid assets beyond cash to meet short-term obligations, or a corporate policy of minimizing holdings of cash in favor of investments or operational efficiencies. The gradual decline over the observed periods indicates a possible shift towards lower cash reserves, which could be driven by operational considerations, capital allocation strategies, or changes in the company's liquidity management approach.

In summary, Parker-Hannifin’s cash ratio demonstrates a pattern of conservative yet declining liquidity levels over the analyzed timeframe, typically remaining below 0.10 in recent quarters. This trend warrants ongoing monitoring to understand the implications for short-term financial flexibility and risk management.