Parker-Hannifin Corp (PH) — This company manufactures motion and control technologies and systems for the mobile, industrial and aerospace markets. It operates in the United States and 49 other countries, providing services to 450,000 customers.
S&P Capital IQ Equity Research rates PH stock a “sell,” based primarily on growth and valuation, but it also received negative marks for sentiment and price momentum.
For fiscal 2016 (ending in June), analysts estimate revenue will fall 9.3% year over year to $11.5 billion, while earnings are expected to decline nearly 16% to $6.12 per share.
In the past six months, insiders have sold more than 35,000 shares with no insider purchases during that time.
Technically, PH stock is in a pronounced bear market. Shares have fallen from an all-time high above $133 in November 2014 to the mid-$90s.
They appeared to be making an effort to consolidate from a triple-top beginning in October; however, early this month, the formation failed, breaking down from a bottom at about $98.
There is shallow support at about $95, and other indicators are weak, telling us that this support will probably not hold.
Sell PH stock short at $95 with a minimum downside price target of $85 for a potential return of more than 10%. A stop-loss order should be entered at $100 to protect against a breakout and the possibility of a theoretically unlimited loss. As with all short sales, traders should check with their broker for any special restrictions and the ability to borrow shares.
