Aristotle Capital Management, LLC, an investment management company, released its “Value Equity Strategy” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. U.S. equity markets hit new all-time highs in Q4 2025, with the S&P 500 Index up 2.66% and the Bloomberg U.S. Aggregate Bond Index rising 1.10%. Value stocks outperformed growth stocks, and the U.S. economy showed resilience. Artificial intelligence was a major theme, with over 300 S&P 500 companies mentioning “AI” in earnings calls, boosting mega-cap tech stocks. However, concerns arose about AI revenue circularity, capital spending, and long-term investment returns. Against this backdrop, the Composite returned 1.45% pure gross of fees (0.95% net of fees), lagging the Russell 1000 Value Index’s 3.8% gain and the S&P 500 Index’s 2.66% gain. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Aristotle Capital Value Equity Strategy highlighted stocks like Parker-Hannifin Corporation (NYSE:PH). Parker-Hannifin Corporation (NYSE:PH) manufactures motion and control technologies and systems for mobile, industrial, and aerospace markets, and is a significant contributor to the Strategy’s performance in the quarter. The one-month return of Parker-Hannifin Corporation (NYSE:PH) was 6.16%, and its shares gained 39.99% of their value over the last 52 weeks. On February 3, 2026, Parker-Hannifin Corporation (NYSE:PH) stock closed at $964.33 per share, with a market capitalization of $121.714 billion.
Aristotle Capital Value Equity Strategy stated the following regarding Parker-Hannifin Corporation (NYSE:PH) in its fourth quarter 2025 investor letter:
“Parker-Hannifin Corporation (NYSE:PH), the manufacturer of motion and control technologies, was the top contributor during the quarter. The company continues to benefit from strength in its aerospace business, where demand for original equipment and aftermarket services has driven organic growth and margin expansion. The ongoing integration of Meggitt, which Parker Hannifin acquired in 2022, has further expanded the company’s aerospace and defense capabilities while increasing exposure to higher-margin aftermarket revenue—a catalyst we previously identified. Alongside this progress, management has continued to strengthen the company’s balance sheet following a period of elevated acquisition activity, with net debt-to-EBITDA trending lower. In addition, Parker Hannifin’s broad portfolio of motion and control technologies positions the company to benefit from secular trends such as factory automation, electrification of industrial equipment, digitization, and increased complexity and modernization across commercial and defense aerospace platforms. The company continues to execute its Win Strategy, driving operational excellence, pricing discipline and strong cash flow generation. We believe these catalysts support a more resilient earnings profile and will allow Parker Hannifin to continue improving profitability and FREE cash flow generation over time.”
Parker-Hannifin Corporation (NYSE:PH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 57 hedge fund portfolios held Parker-Hannifin Corporation (NYSE:PH) at the end of the third quarter, up from 51 in the previous quarter. Parker-Hannifin Corporation (NYSE:PH) achieved record Q2 fiscal 2026 sales of $5.2 billion, with an organic growth rate of 6.6%. While we acknowledge the risk and potential of Parker-Hannifin Corporation (NYSE:PH) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Parker-Hannifin Corporation (NYSE:PH) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Parker-Hannifin Corporation (NYSE:PH) and shared the list of best HVAC stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
