Parker-Hannifin Corporation (PH Quick QuotePH - Free Report) is slated to release first-quarter fiscal 2025 (ended Sept. 30, 2024) results on Oct. 31, before market open.

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The Zacks Consensus Estimate for revenues is pegged at $4.9 billion, indicating growth of 1.2% from the prior-year quarter’s number. The consensus mark for earnings is pinned at $6.13 per share, which has inched up 0.3% in the past 60 days. The figure indicates an increase of 2.9% from the prior-year figure.

The company has a stellar earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 11.2%.

Let’s see how things have shaped up for Parker-Hannifin this earnings season.

Factors Likely to Have Shaped PH’s Quarterly Performance

Solid momentum in commercial and military end markets across both OEM and aftermarket channels is expected to have buoyed the Aerospace Systems segment’s revenues. Healthy demand for its products and aftermarket support services in the general aviation market, driven by growth in air transport activities, is likely to have augmented its performance. Also, strength in its defense end market, owing to increase in U.S. and international defense spending volumes, is likely to have been beneficial.

The acquisition of Meggitt expanded its presence in the United Kingdom, positioning it well to provide a broader suite of solutions for aircraft and aero-engine components and systems. The buyout is also expected to augment the Aerospace Systems segment’s results. The Zacks Consensus Estimate for the segment’s quarterly revenues is pegged at $1.36 billion, indicating 10.7% growth from the year-ago number.

Benefits from the Win Strategy, which focuses on innovation, strategic positioning and capital allocation policy, are expected to have aided PH’s margins in the fiscal first quarter. Notably, the Win strategy is the company’s business system that defines goals and initiatives, which enables long-term and sustainable growth.

However, challenging conditions in off-highway and transportation end markets are expected to have hurt the Diversified Industrial segment’s performance. Softness across construction and agricultural sectors is likely to have weighed on both the North America and international businesses of the segment.

The consensus estimate for the Diversified Industrial North America segment’s revenues is pinned at $2.18 billion, indicating a 2.1% decline year over year. The consensus mark for the Diversified Industrial International segment’s revenues is pegged at $1.34 billion, indicating a 3.5% decrease year over year.

Given the company’s substantial international operations, foreign currency headwinds are likely to have marred its margins and profitability.

Earnings Whisper

Our proven model predicts an earnings beat for Parker-Hannifin this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as elaborated below.

Earnings ESP: Parker-Hannifin has an Earnings ESP of +0.83% as the Most Accurate Estimate is pegged at $6.18, higher than the Zacks Consensus Estimate of $6.13. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: PH presently carries a Zacks Rank of 2.

Other Stocks With the Favorable Combination

Here are three other companies, which according to our model, have the right combination of elements to post an earnings beat this season.

Ingersoll Rand Inc. (IR Quick QuoteIR - Free Report) has an Earnings ESP of +1.22% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is scheduled to release third-quarter results on Oct. 31. Ingersoll’s earnings have surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 11%.

Crane Company (CR Quick QuoteCR - Free Report) has an Earnings ESP of +0.09% and a Zacks Rank of 2 at present. The company is slated to release third-quarter results on Oct. 28.

Crane Company’s earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 11.2%.

Xylem Inc. (XYL Quick QuoteXYL - Free Report) has an Earnings ESP of +0.10% and a Zacks Rank of 3 at present. The company is slated to release its third-quarter 2024 results on Oct. 31.

XYL’s earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.1%.