Paccar (PCAR) stock price is $104.50, down 1.56% on the day, as of Nov 5, 2026. It has a market cap of $55.07Bn and a P/E ratio of 19.94, and is classified in the Heavy Equipment industry (Industrials sector).
Enterprise Value
Margins
P/FCF
Key Stats
Market Cap55.07 Bn
P/E19.94
FCF (Yr)3.03 Bn
ROA (Yr)5.41
EV to EBIT-0.90
Net Income (Yr)2.38 Bn
Enterprise Value17.93 Bn
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About
PACCAR Inc is a multinational company that designs manufactures and distributes commercial trucks and provides related parts and financial services. The company operates primarily in the truck manufacturing industry with a global footprint that includes production facilities in North America Europe Australia Brazil Canada and Mexico. Its core activities involve building trucks under the Kenworth Peterbilt and DAF nameplates and supporting those products through aftermarket…
PACCAR Inc is a multinational company that designs manufactures and distributes commercial trucks and provides related parts and financial services. The company operates primarily in the truck manufacturing industry with a global footprint that includes production facilities in North America Europe Australia Brazil Canada and Mexico. Its core activities involve building trucks under the Kenworth Peterbilt and DAF nameplates and supporting those products through aftermarket parts distribution and financing solutions.
The company generates revenue from three main sources. First it sells new trucks to independent dealers who then sell them to end users such as trucking companies and owner operators. Second it distributes aftermarket parts for trucks and related commercial vehicles through a network of parts distribution centers and branded TRP stores worldwide. Third it provides finance and leasing products including loans leases and used truck sales to customers dealers and franchises in the markets where its trucks are sold.
PACCAR Inc operates through the following three segments: Truck Parts and Financial Services.
The Truck segment includes the design manufacture and distribution of light medium and heavy duty commercial trucks. It produces vehicles under the Kenworth Peterbilt and DAF nameplates in plants located in the United States Europe Australia Brazil Canada and Mexico. The segment also designs and manufactures diesel engines primarily for use in its trucks at facilities in Columbus Mississippi Eindhoven the Netherlands and Ponta Grossa Brazil. Revenue from this segment accounted for approximately sixty eight percent of total net sales in 2025.
The Parts segment distributes aftermarket parts for trucks and related commercial vehicles to more than two thousand Kenworth Peterbilt and DAF dealers and over three hundred fifty TRP stores in ninety nine countries. It operates twenty one strategically located parts distribution centers in the United States Canada Europe Australia Mexico and Central and South America. Parts are sourced from external suppliers and also manufactured in house. This segment contributed about twenty four percent of total net sales in 2025.
The Financial Services segment provides finance and leasing products and services to customers and dealers in twenty six countries across North America Europe Australia and South America. It offers retail loans leases dealer inventory financing and full service leasing under the PacLease brand. The segment also manages the sale of used trucks returned from leases and repossessions. In 2025 this segment accounted for roughly eight percent of total net sales and represented fifty one percent of total assets.
PACCAR Inc holds a strong position in the global commercial truck market. In the United States and Canada its Class 8 market share was twenty nine point nine percent and its medium duty market share was fifteen point nine percent in 2025. In Europe the DAF brand achieved a thirteen point five percent share of the heavy duty market and a nine point seven percent share of the light medium duty market. The company faces four principal competitors in the North American Class 8 segment and six principal competitors in the European market. Competitive advantages include a reputation for high quality trucks a diversified product portfolio across three well known nameplates a vertically integrated supply chain for key components long term supplier agreements with major parts providers and a robust dealer network that supports sales and service worldwide.
The company sells its trucks to independent dealers who then serve a broad range of end users including trucking companies owner operators fleet operators and other businesses that require transportation of goods. Its aftermarket parts are sold to the same dealer network and to TRP stores that cater to repair and maintenance needs. The financial services segment provides loans and leases to small medium and large commercial trucking companies independent owner operators and fleet customers seeking financing for equipment acquisition.
Sectors:Industrials·Financial ServicesSector rationalePACCAR's primary business is the design, manufacture, and distribution of commercial trucks (Kenworth, Peterbilt, DAF) and diesel engines, which falls under the Industrials sector. The company also operates a substantial and distinct Financial Services segment that provides retail loans, leases, and dealer inventory financing, justifying a secondary sector classification.Industries:Heavy EquipmentHeavy EquipmentPrimaryPACCAR designs and manufactures heavy-duty commercial trucks under the Kenworth, Peterbilt, and DAF nameplates, as well as the diesel engines that power them. This activity constitutes the majority of its revenue, accounting for approximately 68% of total net sales in 2025.Specialty FinanceSpecialty FinanceSecondaryThe company operates a Financial Services segment that provides retail loans, leases, and dealer inventory financing specifically for its commercial truck equipment. This captive finance arm accounts for roughly 8% of total net sales and 51% of total assets.Industrial DistributionIndustrial DistributionSecondaryPACCAR distributes aftermarket parts for trucks and commercial vehicles through a global network of over 2,000 dealers and 350 TRP stores. This distribution business contributed approximately 24% of total net sales in 2025.Classified using BQ-MICSCIK: 0000075362
Bull & bear
Investment Thesis
▲ Bull case
PACCAR is positioned to capture significant upside from the accelerating prebuy cycle ahead of the 2027 EPA emissions standards, a catalyst that management underemphasized despite clear customer sensitivity to the 35 milligram NOx rule. The company’s leadership in premium vocational and electric trucks—exemplified by the award-winning DAF XF and XG+ Electric models—creates a first-mover advantage in segments where total cost of ownership is becoming favorable even without subsidies, particularly in urban and vocational applications. This is reinforced by the launch of Kenworth’s C580 vocational truck, which targets high-margin severe-service markets like mining and off-highway petroleum, where customers prioritize durability and uptime over initial cost. With PACCAR’s local-for-local manufacturing strategy reducing supply chain volatility and its build slots already full for Q2 with strong visibility into Q3 and Q4, the company is uniquely equipped to meet surging demand as fleet operators accelerate orders to avoid future compliance costs. The strengthening used truck market, highlighted by PACCAR Financial Services’ improved pretax income of $116 million driven by asset growth and utilization, further supports a virtuous cycle where higher trade-in values enable customers to upgrade fleets, directly boosting new truck orders and parts demand. Management’s guidance for Q2 gross margins to expand to 13.5% from 13.1% in Q1, driven by higher global production volumes and persistent price/cost favorability, suggests that incremental margin expansion is already underway and will accelerate as volumes rise, especially given that truck segment gross margin was above 7% in Q1 despite only a $11 million sequential revenue increase—indicating potent operating leverage. The company’s inventory position at 2.8 months of sales, well below the industry average of over four months, reflects disciplined supply chain management and reduces obsolescence risk, freeing capital for strategic investments in next-generation powertrains and autonomous vehicle platforms. Finally, the recent dividend increase to $0.35 per share signals management’s confidence in sustainable cash flow generation, underpinned by the resilience of PACCAR Parts, which delivered $1.7 billion in revenue with 29.6% gross margins and is poised for 3%-6% full-year growth through network expansion, providing a stable high-margin foundation that cushions cyclicality in the truck segment.
PACCAR is positioned to capture significant upside from the accelerating prebuy cycle ahead of the 2027 EPA emissions standards, a catalyst that management underemphasized despite clear customer sensitivity to the 35 milligram NOx rule. The company’s leadership in premium vocational and electric trucks—exemplified by the award-winning DAF XF and XG+ Electric models—creates a first-mover advantage in segments where total cost of ownership is becoming favorable even without subsidies, particularly in urban and vocational applications. This is reinforced by the launch of Kenworth’s C580 vocational truck, which targets high-margin severe-service markets like mining and off-highway petroleum, where customers prioritize durability and uptime over initial cost. With PACCAR’s local-for-local manufacturing strategy reducing supply chain volatility and its build slots already full for Q2 with strong visibility into Q3 and Q4, the company is uniquely equipped to meet surging demand as fleet operators accelerate orders to avoid future compliance costs. The strengthening used truck market, highlighted by PACCAR Financial Services’ improved pretax income of $116 million driven by asset growth and utilization, further supports a virtuous cycle where higher trade-in values enable customers to upgrade fleets, directly boosting new truck orders and parts demand. Management’s guidance for Q2 gross margins to expand to 13.5% from 13.1% in Q1, driven by higher global production volumes and persistent price/cost favorability, suggests that incremental margin expansion is already underway and will accelerate as volumes rise, especially given that truck segment gross margin was above 7% in Q1 despite only a $11 million sequential revenue increase—indicating potent operating leverage. The company’s inventory position at 2.8 months of sales, well below the industry average of over four months, reflects disciplined supply chain management and reduces obsolescence risk, freeing capital for strategic investments in next-generation powertrains and autonomous vehicle platforms. Finally, the recent dividend increase to $0.35 per share signals management’s confidence in sustainable cash flow generation, underpinned by the resilience of PACCAR Parts, which delivered $1.7 billion in revenue with 29.6% gross margins and is poised for 3%-6% full-year growth through network expansion, providing a stable high-margin foundation that cushions cyclicality in the truck segment.
PACCAR faces mounting pressure from persistent raw material cost inflation that is eroding truck segment profitability, a risk management downplayed by characterizing tariff impacts as “moderate but not significant” while avoiding discussion of broader commodity pressures. Brice Poplawski’s candid admission that truck prices rose only 2% year-over-year while costs increased more than that—directly compressing margins—contrasts sharply with the sequential narrative of flat pricing and declining costs, revealing a troubling year-over-year deterioration in truck economics that could worsen if energy and metal prices remain elevated. The company’s reliance on price/cost favorability as a margin driver is increasingly fragile, especially as over-the-road spot rates, while up double digits, remain volatile and tied to geopolitical risks in the Middle East that could abruptly reverse freight market improvements, undermining the demand recovery narrative. Furthermore, PACCAR’s guidance for U.S. and Canada truck market volume of 230,000–270,000 units in 2026 implies a significant slowdown from historical averages near 267,000, suggesting that the current rebound may be weaker and shorter-lived than anticipated, particularly if fleet operators remain cautious amid ongoing operating cost volatility and uncertain economic conditions. The slow start in PACCAR Parts growth—estimated at only 3% for Q2 despite network expansion efforts—signals that aftermarket demand is not accelerating as expected, potentially reflecting delayed maintenance cycles or customer reluctance to invest in optional repairs during a fragile recovery, which could persist if freight rates fail to sustain their current strength. Management’s confidence in capturing prebuy demand ahead of 2027 overlooks the possibility that customers may delay purchases further due to uncertainty around the final implementation of the NOx standard or seek cheaper alternatives from competitors, especially as non-domestic producers begin pricing for tariffs and gaining share in price-sensitive segments. Additionally, PACCAR’s significant capital allocation—$725–$775 million in investments and $450–$500 million in R&D—risks overextension if returns on next-generation technologies like autonomous vehicles and connected services fail to materialize quickly, diverting funds from core truck profitability during a period of margin pressure. Finally, the industry-wide inventory overhang, with PACCAR at 2.8 months but the broader market above four months, suggests that downstream channel inventory correction could still occur, forcing production cuts and pressuring utilization rates even if PACCAR’s internal metrics appear healthy, as dealer lots remain bloated and slow to turn.
PACCAR faces mounting pressure from persistent raw material cost inflation that is eroding truck segment profitability, a risk management downplayed by characterizing tariff impacts as “moderate but not significant” while avoiding discussion of broader commodity pressures. Brice Poplawski’s candid admission that truck prices rose only 2% year-over-year while costs increased more than that—directly compressing margins—contrasts sharply with the sequential narrative of flat pricing and declining costs, revealing a troubling year-over-year deterioration in truck economics that could worsen if energy and metal prices remain elevated. The company’s reliance on price/cost favorability as a margin driver is increasingly fragile, especially as over-the-road spot rates, while up double digits, remain volatile and tied to geopolitical risks in the Middle East that could abruptly reverse freight market improvements, undermining the demand recovery narrative. Furthermore, PACCAR’s guidance for U.S. and Canada truck market volume of 230,000–270,000 units in 2026 implies a significant slowdown from historical averages near 267,000, suggesting that the current rebound may be weaker and shorter-lived than anticipated, particularly if fleet operators remain cautious amid ongoing operating cost volatility and uncertain economic conditions. The slow start in PACCAR Parts growth—estimated at only 3% for Q2 despite network expansion efforts—signals that aftermarket demand is not accelerating as expected, potentially reflecting delayed maintenance cycles or customer reluctance to invest in optional repairs during a fragile recovery, which could persist if freight rates fail to sustain their current strength. Management’s confidence in capturing prebuy demand ahead of 2027 overlooks the possibility that customers may delay purchases further due to uncertainty around the final implementation of the NOx standard or seek cheaper alternatives from competitors, especially as non-domestic producers begin pricing for tariffs and gaining share in price-sensitive segments. Additionally, PACCAR’s significant capital allocation—$725–$775 million in investments and $450–$500 million in R&D—risks overextension if returns on next-generation technologies like autonomous vehicles and connected services fail to materialize quickly, diverting funds from core truck profitability during a period of margin pressure. Finally, the industry-wide inventory overhang, with PACCAR at 2.8 months but the broader market above four months, suggests that downstream channel inventory correction could still occur, forcing production cuts and pressuring utilization rates even if PACCAR’s internal metrics appear healthy, as dealer lots remain bloated and slow to turn.