PACCAR Inc (PCAR) stock analysis

P/E above its 5-year median

Paccar's P/E of 20.6 is above its own 5-year median of 14.1.

P/E above the industry

Paccar's P/E of 20.6 is above the Motor Vehicles and Motor Vehicle Equipment median of 18.7.

EV/EBITDA above its 5-year median

Paccar's EV/EBITDA of 13.6 is above its 5-year median of 9.5.

P/B above the industry

Paccar's price-to-book of 2.72 is above the Motor Vehicles and Motor Vehicle Equipment median of 1.56.

Trading above fair value

The share price of $108.13 is above our fair value estimate of $81.50.

Margin of safety under 20%

The price is 32.7% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -0.4% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -7.8% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 2.6% over the last twelve months, against a 5-year average of 12.8% a year.

Growing slower than the industry

Revenue grew -1.5% over the last twelve months; the Motor Vehicles and Motor Vehicle Equipment median is 5.5%.

Guidance lowered

Paccar lowered its 2026 research and development expenses outlook on Jul 28, 2026.

Gross margin slipping

Gross margin was 20.1% over the last twelve months, against 20.7% a year earlier.

Return on equity under 15%

Return on equity was 13.7% over the last twelve months and averaged 22.1% over five years; we look for 15% on both.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

Paccar's return on equity of 13.7% is above the Motor Vehicles and Motor Vehicle Equipment median of 3.5%.

Earnings grew over 5 years

Net income grew 12.8% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 9.5% over the last twelve months, against a 5-year average of 10.4%.

Net margin above the industry

Paccar's net margin of 9.5% is above the Motor Vehicles and Motor Vehicle Equipment median of 1.9%.

No debt

Paccar has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term liquidity

The balance sheet is not split into current and non-current items.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.69; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Paccar paid dividends worth 1.6% of the share price over the last twelve months.

Yield below Treasuries

The 1.6% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Paccar yields 1.6%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 52.6% of net income.

Covered by free cash flow

Dividends take 47.7% of free cash flow.