Paccar (PCAR)
NASDAQ:PCAR
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Paccar
(NASDAQ:PCAR)
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Rating:72Outperform
Price Target:
$134.00
â–²(16.19% Upside)
Action:DowngradedDate:01/28/26
PCAR scores 72 driven primarily by strong multi-year financial quality and durable cash generation, supported by a technically bullish trend. The score is tempered by the 2025 cyclical slowdown and a relatively high P/E, while earnings-call guidance for improving margins and 2026 growth provides a meaningful positive offset.
Positive Factors
Free cash flow generation
PACCAR's multi-year, multi-billion free cash flow generation underpins durable financial flexibility. Strong operating and free cash flow support sustained capex, R&D, dividends and potential buybacks without reliance on external financing, helping the company weather industry cycles and fund strategic initiatives.
Negative Factors
2025 cyclical revenue and margin weakness
An ~11% revenue decline and material margin compression in 2025 highlight sensitivity to freight cycles and pricing. Such cyclical exposure can pressure earnings and free cash flow durability during downturns, limiting reinvestment capacity and increasing reliance on parts/finance to offset truck sales volatility.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
PACCAR's multi-year, multi-billion free cash flow generation underpins durable financial flexibility. Strong operating and free cash flow support sustained capex, R&D, dividends and potential buybacks without reliance on external financing, helping the company weather industry cycles and fund strategic initiatives.
Read all positive factors
Paccar (PCAR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$60.65B
Dividend Yield3.83%
Average Volume (3M)3.04M
Price to Earnings (P/E)24.2
Beta (1Y)0.87
Revenue Growth-15.29%
EPS Growth-42.93%
CountryUS
Employees30,100
SectorIndustrials
Sector Strength72
IndustryAgricultural - Machinery
Share Statistics
EPS (TTM)1.06
Shares Outstanding525,894,500
10 Day Avg. Volume2,712,384
30 Day Avg. Volume3,039,163
Financial Highlights & Ratios
PEG Ratio-0.56
Price to Book (P/B)2.99
Price to Sales (P/S)2.03
P/FCF Ratio19.02
Enterprise Value/Market Cap0.83
Enterprise Value/Revenue1.76
Enterprise Value/Gross Profit10.84
Enterprise Value/Ebitda12.81
Forecast
1Y Price Target
$130.06Price Target Upside12.77% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)5.65
Revenue Forecast (FY)$28.40B
Paccar Business Overview & Revenue Model
Company Description
PACCAR Inc designs, manufactures, and distributes light, medium, and heavy-duty commercial trucks in the United States, Europe, Mexico, South America, Australia, and internationally. It operates through three segments: Truck, Parts, and Financial ...
How the Company Makes Money
Paccar generates revenue primarily through the sale of trucks and related parts. The company's key revenue streams include the sale of new trucks, which accounts for a significant portion of its income, as well as aftermarket parts and services th...
Paccar Key Performance Indicators (KPIs)
Any
Revenue by Segment
Highlights revenue contributions from different business segments, providing insight into which areas drive growth and profitability, and where strategic focus may be needed.
Highlights revenue contributions from different business segments, providing insight into which areas drive growth and profitability, and where strategic focus may be needed.
Data provided by:
The Fly
The FlyPaccar Earnings Call Summary
Earnings Call Date:Jan 27, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 28, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive outlook supported by record results in Parts and Financial Services, strong annual profitability, improving margins and constructive market forecasts for 2026. Notable operational achievements, product awards and continued investments in R&D and manufacturing strengthen the long-term position. Lowlights were largely transitional or timing-related (Q4 manufacturing conversion inefficiencies, tariff timing, regulatory cost uncertainty, and near-term pricing competition). Management provided guidance and explanations that these issues are manageable and non-recurring, and expects sequential improvement across 2026.Positive Updates
Strong Quarterly and Annual Financial Results
Q4 2025 revenues of $6.8 billion and net income of $557 million; full-year 2025 revenues of $28.4 billion and adjusted net income of $2.64 billion (fourth highest profit year and 87th consecutive year of profits). Adjusted after-tax return on revenue was 9.3%.
Negative Updates
Soft Freight Market and 2025 Headwinds
2025 experienced soft freight markets, tariff uncertainty, and emissions policy uncertainty that pressured industry demand and contributed to operating complexity throughout the year.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Quarterly and Annual Financial Results
Q4 2025 revenues of $6.8 billion and net income of $557 million; full-year 2025 revenues of $28.4 billion and adjusted net income of $2.64 billion (fourth highest profit year and 87th consecutive year of profits). Adjusted after-tax return on revenue was 9.3%.
Read all positive updates
Company Guidance
PACCAR guided to sequential margin and revenue improvement in 1Q and for 2026: consolidated gross margins are expected to rise to 12.5%–13% in Q1 (vs. Q4 truck/other gross margin of 12%), PACCAR Parts is forecast +~3% in Q1 and +4%–8% for the year (Parts 2025: $6.9B revenue, $1.67B pretax; Q4 parts rev $1.7B, Q4 pretax $415M; Q4 parts gross margin 29.5%), and PACCAR Financial Services follows a record 2025 (FY rev $2.2B; pretax $485M; Q4 rev $569M; Q4 pretax $115M) with market share at 27%. Truck deliveries were 32,900 in Q4 and are expected to be at a comparable level in 2026; industry unit forecasts are 230k–270k Class 8 units for US/Canada in 2026 (2025 NA retail 233k; PACCAR share 30%), Europe 280k–320k above‑16t (2025: 298k; PACCAR heavy‑duty share 13.5%), and South America 100k–110k (2025: 115k). Planned 2026 investments include $725–775M capex and $450–500M R&D; other metrics highlighted: FY 2025 revenue $28.4B, adjusted net income $2.64B (after‑tax return on revenue 9.3%), dividends $2.72/share (yield ~3%), industry inventory 3.2 months vs. PACCAR 2.2 months, removal of tariff surcharges for 2026 due to Section 232, EPA ’27 NOx set at 35 mg (potential new‑truck cost impact ~±$10,000), and management expects 2026 to be a year of accelerated growth.Paccar Financial Statement Overview
Summary
Income Statement
73
Positive
Balance Sheet
67
Positive
Cash Flow
76
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 28.44B | 33.66B | 35.13B | 28.82B | 23.52B |
| Gross Profit | 4.62B | 6.71B | 7.63B | 5.23B | 4.28B |
| EBITDA | 4.20B | 5.81B | 6.87B | 4.47B | 3.28B |
| Net Income | 2.38B | 4.16B | 4.60B | 3.01B | 1.87B |
Balance Sheet | |||||
| Total Assets | 44.34B | 43.42B | 40.82B | 33.28B | 29.51B |
| Cash, Cash Equivalents and Short-Term Investments | 9.25B | 9.84B | 9.00B | 6.31B | 4.99B |
| Total Debt | 0.00 | 15.89B | 14.38B | 11.68B | 10.76B |
| Total Liabilities | 25.07B | 25.91B | 24.94B | 20.11B | 17.92B |
| Stockholders Equity | 19.26B | 17.51B | 15.88B | 13.17B | 11.59B |
Cash Flow | |||||
| Free Cash Flow | 3.03B | 2.90B | 2.93B | 1.64B | 553.90M |
| Operating Cash Flow | 4.42B | 4.64B | 4.19B | 3.03B | 2.19B |
| Investing Cash Flow | -2.27B | -4.49B | -2.87B | -2.03B | -1.36B |
| Financing Cash Flow | -3.08B | -123.10M | 1.10B | 304.90M | -882.90M |
Paccar Technical Analysis
Neutral
115.33
Price Trends
121.93
Negative
113.85
Positive
104.74
Positive
Market Momentum
-2.25
Positive
41.86
Neutral
69.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PCAR, the sentiment is Neutral. The current price of 115.33 is below the 20-day moving average (MA) of 118.10, below the 50-day MA of 121.93, and above the 200-day MA of 104.74, indicating a neutral trend. The MACD of -2.25 indicates Positive momentum. The RSI at 41.86 is Neutral, neither overbought nor oversold. The STOCH value of 69.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PCAR.
Paccar Risk Analysis
Paccar disclosed 17 risk factors in its most recent earnings report. Paccar reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Paccar Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $327.19B | 30.12 | 45.10% | 0.98% | -1.51% | -9.69% | |
73 Outperform | $156.98B | 54.83 | 18.93% | 1.34% | -11.66% | -27.80% | |
72 Outperform | $60.65B | 24.25 | 12.57% | 3.83% | -15.29% | -42.93% | |
66 Neutral | $8.39B | 20.15 | 17.36% | 1.10% | -20.09% | 121.28% | |
66 Neutral | $8.96B | 12.46 | 14.57% | 1.56% | -2.28% | -0.53% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
59 Neutral | $13.60B | 22.56 | 6.58% | 2.67% | -18.10% | -65.24% |
* Industrials Sector Average
PCAR
Paccar
112.75
18.26
19.33%
AGCO
Agco
113.53
20.95
22.63%
CAT
Caterpillar
695.40
370.19
113.83%
CNH
CNH Industrial
10.72
-1.25
-10.44%
DE
Deere
566.64
106.02
23.02%
OSK
Oshkosh
140.31
47.52
51.20%
Paccar Corporate Events
Business Operations and StrategyExecutive/Board Changes
PACCAR announces executive retirement and leadership transition
Neutral
Jan 16, 2026
On January 14, 2026, PACCAR announced that Executive Vice President C. Michael Dozier will retire on April 1, 2026, after 37 years with the company, marking the departure of a long-serving senior leader. As part of the planned leadership transitio...
Executive/Board Changes
Paccar Announces Key Executive Promotions
Neutral
Dec 12, 2025
Paccar announced key executive promotions effective January 1, 2026, with Kevin D. Baney being promoted to President after serving as Executive Vice President since January 2025. Baney, with 31 years at the company, will oversee DAF Trucks, PACCAR...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.