Paccar (PCAR) AI Stock Analysis

• Market Cap: $49.94B
• Dividend Yield: 1.39%
• Average Volume (3M): 2.43M
• Price to Earnings (P/E): 14.4
• Beta (1Y): 0.81
• Revenue Growth: -8.64%
• EPS Growth: -31.57%
• Country: US
• Employees: 30,100
• Sector: Industrials
• Sector Strength: 89
• Industry: Agricultural - Machinery
• EPS (TTM): 1.46
• Shares Outstanding: 524,959,400
• 10 Day Avg. Volume: 2,284,114
• 30 Day Avg. Volume: 2,428,678
• PEG Ratio: -0.87
• Price to Book (P/B): 2.78
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 21.16
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 0.44
• Enterprise Value/Gross Profit: 10.43
• Enterprise Value/Ebitda: 2.52
• 1Y Price Target: $102.14
• Price Target Upside: 8.60% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 78 Outperform
• Price Target: $109.00 ▲(15.90%Upside)

Paccar's overall score reflects strong financial performance and reasonable valuation balanced against mixed technical signals and earnings call sentiment. The company's financial health and strategic investments support its stability and growth, but economic uncertainties and tariff impacts present challenges.

Positive Factors

Earnings

Earnings 10yr CAGR is 12%, compared to the industrial average of high singles, and the company pays a far larger dividend than most.

Market Position

PCAR is viewed as a high-quality cyclical with a favorable competitive position, newer truck models expected to gain market share, and a best-in-class strategy for alternative drivetrains.

Market Recovery

The underlying Class 8 truck market is on the cusp of a recovery in North America, driven by replacement demand and upcoming regulatory changes.

Negative Factors

Competition

Increased competition from companies like Volvo and Daimler Truck, which have different sourcing strategies, may affect PCAR's market position.

Market Uncertainty

The freight and truck market downturn continues to unfold, creating uncertainty about PCAR’s gross margin bottoming.

Regulatory Risks

Political risks and uncertainties related to EPA ‘27 remain, presenting a risk to current industry pre-buy estimates.

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 Services. The Truck segment designs, manufactures, and distributes trucks for the over-the-road and off-highway hauling of commercial and consumer goods. It sells its trucks through a network of independent dealers under the Kenworth, Peterbilt, and DAF nameplates. The Parts segment distributes aftermarket parts for trucks and related commercial vehicles. The Financial Services segment conducts full-service leasing operations under the PacLease trade name, as well as provides finance and leasing products and services to customers and dealers. This segment also offers equipment financing and administrative support services for its franchisees; retail loan and leasing services for small, medium, and large commercial trucking companies, as well as independent owners/operators and other businesses; and truck inventory financing services to independent dealers. In addition, this segment offers loans and leases directly to customers for the acquisition of trucks and related equipment. The company also manufactures and markets industrial winches under the Braden, Carco, and Gearmatic nameplates. PACCAR Inc was founded in 1905 and is headquartered in Bellevue, Washington.

How the Company Makes Money

PACCAR makes money through several key revenue streams. The primary source is the sale of trucks, which includes a wide range of models designed for various applications and markets. Additionally, the company generates significant revenue from its parts business, which supplies aftermarket parts to support the maintenance and repair of its trucks. Financial services also contribute to the company's earnings, offering financing and leasing solutions to customers purchasing its vehicles. Furthermore, PACCAR's global reach and strategic partnerships with suppliers and dealers enhance its ability to capture market share and maintain strong profit margins.

Paccar Financial Statement Overview

Summary

Paccar demonstrates strong financial performance with consistent profitability, efficient asset utilization, and strong cash generation, despite a slight revenue decline. The company's robust cash position and high return on equity support its financial stability and growth potential. However, moderate leverage and high absolute debt levels could pose risks if interest rates rise.

Income Statement

Paccar's income statement shows solid profitability with a gross profit margin of 17.8% and a net profit margin of 10.7% for TTM. Despite a slight decline in revenue by 3.9% compared to the previous annual report, the company maintains strong EBIT and EBITDA margins at 13.3% and 16.0%, respectively. The consistent profitability and efficient cost management highlight the company's strong competitive position in the industry.

Balance Sheet

The balance sheet reflects a healthy financial structure with a debt-to-equity ratio of 0.87, indicating moderate leverage. The equity ratio stands at 42.2%, demonstrating a solid capital position. Return on equity is robust at 19.3%, showcasing effective utilization of shareholders' equity. However, the high absolute levels of debt could pose risks if interest rates rise or market conditions deteriorate.

Cash Flow

Paccar's cash flow statement is strong, with a free cash flow to net income ratio of 0.68, indicating good cash generation relative to profits. The operating cash flow to net income ratio of 1.18 suggests efficient conversion of earnings into cash. Although free cash flow declined by 18.4%, the company maintains a solid cash position, supporting future investments and debt servicing.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	33.66B	35.13B	28.82B	23.52B	18.73B
Gross Profit	5.93B	7.14B	4.75B	3.29B	2.45B
EBITDA	5.81B	6.63B	4.41B	3.27B	2.58B
Net Income	4.16B	4.60B	3.01B	1.87B	1.30B
Balance Sheet
Total Assets	43.42B	40.82B	33.28B	29.30B	28.29B
Cash, Cash Equivalents and Short-Term Investments	9.65B	9.00B	6.16B	4.81B	4.83B
Total Debt	15.89B	14.38B	16.19B	10.76B	11.31B
Total Liabilities	25.91B	24.94B	20.11B	17.86B	17.87B
Stockholders Equity	17.51B	15.88B	13.17B	11.44B	10.42B
Cash Flow
Free Cash Flow	2.90B	2.93B	1.64B	553.90M	1.35B
Operating Cash Flow	4.64B	4.19B	3.03B	2.19B	2.99B
Investing Cash Flow	-4.49B	-2.87B	-2.03B	-1.36B	-1.88B
Financing Cash Flow	-123.10M	1.10B	304.90M	-882.90M	-1.81B

Paccar Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 94.05
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PCAR, the sentiment is Negative. The current price of 94.05 is below the 20-day moving average (MA) of 95.48, below the 50-day MA of 94.28, and below the 200-day MA of 100.74, indicating a neutral trend. The MACD of 0.81 indicates Positive momentum. The RSI at 49.52 is Neutral, neither overbought nor oversold. The STOCH value of 14.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PCAR.

Paccar Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PCAR	78 Outperform	$49.94B	14.43	19.90%	1.39%	-8.64%	-31.57%
OSK	77 Outperform	$7.86B	13.04	15.24%	1.67%	5.95%	-10.59%
Sector *	71 Outperform	¥254.36B	13.56	8.48%	3.02%	6.34%	13.16%
CAT	70 Outperform	$190.31B	19.72	55.67%	1.37%	-5.58%	-7.37%
DE	70 Outperform	$136.35B	24.36	24.07%	1.29%	-22.26%	-37.83%
CNH	66 Neutral	$16.39B	15.79	13.26%	1.94%	-21.99%	-52.11%
AGCO	58 Neutral	$7.97B	46.40	-13.60%	1.08%	-23.02%	-152.78%

Paccar Corporate Events

Paccar Elects Directors and Approves Executive Compensation

On April 28, 2025, Paccar‘s Board of Directors approved Long Term Performance Cash Awards for its executive officers for the 2022-2024 cycle, significantly impacting their total compensation. The annual meeting of stockholders held on April 29, 2025, resulted in the election of directors and approval of executive compensation, while a proposal on excessive golden parachutes was not passed.