Parker-Hannifin Corporation (PH)
Profitability ratios
Return on sales
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Gross profit margin | 36.85% | 35.91% | 33.88% | 27.65% | 27.22% |
| Operating profit margin | 20.45% | 19.58% | 16.89% | 17.75% | 16.74% |
| Pretax margin | 20.69% | 18.04% | 14.06% | 10.18% | 15.66% |
| Net profit margin | 17.79% | 14.27% | 10.93% | 8.29% | 12.17% |
The profitability ratios of Parker-Hannifin Corporation over the period from June 2021 to June 2025 demonstrate a general upward trend, indicating improvements in the company's ability to generate profits relative to its sales.
The gross profit margin, which reflects the core profitability of the company’s products after direct costs, increased from 27.22% in June 2021 to 36.85% in June 2025. This expansion suggests enhanced pricing strategies, efficiency gains in production, or a favorable shift in product mix that has allowed the company to retain a larger proportion of revenue after cost of goods sold.
Operating profit margin also exhibited an upward trajectory, rising from 16.74% in June 2021 to 20.45% in June 2025. This indicates improved operational efficiencies and cost management, leading to a higher proportion of revenue remaining after deducting operating expenses.
The pretax margin experienced some volatility, decreasing from 15.66% in June 2021 to a low of 10.18% in June 2022, before recovering to 20.69% in June 2025. The initial decline may have been due to increased non-operational expenses or impairment charges, but the subsequent recovery highlights a strengthening of the company’s earnings before taxes relative to revenue.
Finally, the net profit margin, which measures overall profitability after all expenses, including taxes, showed significant growth from 12.17% in June 2021 to 17.79% in June 2025. The consistent improvement in net margins indicates that the company has been successful in increasing its profitability after considering all expenses, possibly through cost reductions, revenue enhancements, and favorable tax strategies.
Overall, Parker-Hannifin Corporation's profitability ratios over the analyzed period reflect a positive trend, signifying ongoing enhancements in operational efficiency, cost control, and overall financial performance.
Return on investment
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 13.77% | 13.32% | 10.75% | 10.85% | 11.81% |
| Return on assets (ROA) | 11.97% | 9.71% | 6.95% | 5.07% | 8.58% |
| Return on total capital | 33.01% | 33.97% | 31.51% | 21.13% | 29.73% |
| Return on equity (ROE) | 25.81% | 23.56% | 20.17% | 14.87% | 20.79% |
The analysis of Parker-Hannifin Corporation's profitability ratios over the period from June 30, 2021, to June 30, 2025, reveals several noteworthy trends.
Starting with the Operating Return on Assets (Operating ROA), there is a decline from 11.81% in 2021 to 10.75% in 2023, indicating a slight decrease in operating efficiency relative to asset utilization during that period. However, a significant improvement is observed in 2024, with Operating ROA rising to 13.32%, and further increasing to 13.77% in 2025, suggesting an enhanced ability to generate operating income from the asset base.
The Return on Assets (ROA), which accounts for net income relative to total assets, exhibits more volatility, dropping from 8.58% in 2021 to a low of 5.07% in 2022 before recovering to 6.95% in 2023. The subsequent years show a noteworthy upward trend, with ROA climbing to 9.71% in 2024 and reaching 11.97% in 2025, reflecting an overall improvement in net profitability generated from assets.
The Return on Total Capital demonstrates a different pattern. It decreased from 29.73% in 2021 to 21.13% in 2022, then rebounded sharply to 31.51% in 2023, followed by steady increases to 33.97% in 2024 and slightly easing to 33.01% in 2025. This indicates that despite some fluctuations, the company has been consistently effective at generating returns from its overall capital base in the latter years, with a peak in 2024.
Lastly, the Return on Equity (ROE) shows a downward trend from 20.79% in 2021 to 14.87% in 2022, but then recovers strongly in 2023 to 20.17%. The subsequent years further demonstrate an upward trajectory, reaching 23.56% in 2024 and 25.81% in 2025. This pattern suggests that the company has improved its efficiency in generating income from shareholders' equity, especially in the most recent years analyzed.
Overall, while there was a dip in profitability ratios around 2022, the subsequent periods reveal a recovery and strengthening of profitability metrics across all key indicators, indicating an improving profit generation capacity for Parker-Hannifin Corporation in the period leading up to 2025.