NasdaqGS:PCAR

Stock Analysis Report

Executive Summary

PACCAR Inc designs, manufactures, and distributes light, medium, and heavy-duty commercial trucks in the United States, Europe, and internationally.

Rewards

Trading at 14.7% below its fair value

Earnings have grown 15.9% per year over the past 5 years

Risk Analysis

Earnings are forecast to decline by an average of -3.4% per year for the next 3 years

Has a high level of debt

Unstable dividend track record



Snowflake Analysis

Excellent balance sheet established dividend payer.


Similar Companies

Share Price & News

How has PACCAR's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: PCAR has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.3%

PCAR

0.09%

US Machinery

0.3%

US Market


1 Year Return

42.1%

PCAR

21.3%

US Machinery

18.5%

US Market

Return vs Industry: PCAR exceeded the US Machinery industry which returned 21.3% over the past year.

Return vs Market: PCAR exceeded the US Market which returned 18.5% over the past year.


Shareholder returns

PCARIndustryMarket
7 Day-0.3%0.09%0.3%
30 Day1.6%-1.0%1.5%
90 Day18.7%9.6%5.7%
1 Year49.9%42.1%23.6%21.3%21.1%18.5%
3 Year33.9%19.9%39.8%30.9%45.9%36.4%
5 Year44.6%19.8%69.9%49.8%71.4%52.5%

Price Volatility Vs. Market

How volatile is PACCAR's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is PACCAR undervalued compared to its fair value and its price relative to the market?

14.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PCAR ($81.12) is trading below our estimate of fair value ($95.06)

Significantly Below Fair Value: PCAR is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: PCAR is good value based on its PE Ratio (11.6x) compared to the Machinery industry average (22.1x).

PE vs Market: PCAR is good value based on its PE Ratio (11.6x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: PCAR's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: PCAR is overvalued based on its PB Ratio (2.8x) compared to the US Machinery industry average (2.5x).


Next Steps

Future Growth

How is PACCAR forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

-3.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PCAR's earnings are forecast to decline over the next 3 years (-3.4% per year).

Earnings vs Market: PCAR's earnings are forecast to decline over the next 3 years (-3.4% per year).

High Growth Earnings: PCAR's earnings are forecast to decline over the next 3 years.

Revenue vs Market: PCAR's revenue is expected to decline over the next 3 years (-3% per year).

High Growth Revenue: PCAR's revenue is forecast to decline over the next 3 years (-3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PCAR's Return on Equity is forecast to be low in 3 years time (19.2%).


Next Steps

  • Explore growth companies in the Capital Goods industry.

Past Performance

How has PACCAR performed over the past 5 years?

15.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PCAR has high quality earnings.

Growing Profit Margin: PCAR's current net profit margins (9.5%) are lower than last year (9.7%).


Past Earnings Growth Analysis

Earnings Trend: PCAR's earnings have grown by 15.9% per year over the past 5 years.

Accelerating Growth: PCAR's earnings growth over the past year (10.4%) is below its 5-year average (15.9% per year).

Earnings vs Industry: PCAR earnings growth over the past year (10.4%) underperformed the Machinery industry 13.5%.


Return on Equity

High ROE: Whilst PCAR's Return on Equity (24.44%) is high, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is PACCAR's financial position?


Financial Position Analysis

Short Term Liabilities: PCAR's short term assets ($20.4B) exceed its short term liabilities ($4.3B).

Long Term Liabilities: PCAR's short term assets ($20.4B) exceed its long term liabilities ($13.5B).


Debt to Equity History and Analysis

Debt Level: PCAR's debt to equity ratio (109.2%) is considered high.

Reducing Debt: PCAR's debt to equity ratio has reduced from 115.5% to 109.2% over the past 5 years.

Debt Coverage: PCAR's debt is well covered by operating cash flow (27.4%).

Interest Coverage: PCAR earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: PCAR has a low level of unsold assets or inventory.

Debt Coverage by Assets: PCAR's debt is covered by short term assets (assets are 1.9x debt).


Next Steps

Dividend

What is PACCAR's current dividend yield, its reliability and sustainability?

4.04%

Current Dividend Yield


Dividend Yield vs Market

company4.0%marketbottom25%1.4%markettop25%3.7%industryaverage1.9%forecastin3Years3.9%

Current dividend yield vs market & industry

Notable Dividend: PCAR's dividend (4.04%) is higher than the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: PCAR's dividend (4.04%) is in the top 25% of dividend payers in the US market (3.7%)


Stability and Growth of Payments

Stable Dividend: PCAR's dividend payments have been volatile in the past 10 years.

Growing Dividend: PCAR's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (17.7%), PCAR's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PCAR's dividends in 3 years are forecast to be well covered by earnings (45.9% payout ratio).


Next Steps

Management

What is the CEO of PACCAR's salary, the management and board of directors tenure and is there insider trading?

2.5yrs

Average management tenure


CEO

R. Feight (51yo)

0.4yrs

Tenure

US$2,921,495

Compensation

Mr. R. Preston Feight serves as Executive Vice President at PACCAR Inc since September 2018. He has been instrumental in PACCAR delivering revenue and profit growth, in addition to having an integral role ...


CEO Compensation Analysis

Compensation vs Market: R.'s total compensation ($USD2.92M) is below average for companies of similar size in the US market ($USD11.01M).

Compensation vs Earnings: Insufficient data to compare R.'s compensation with company performance.


Management Age and Tenure

2.5yrs

Average Tenure

57yo

Average Age

Experienced Management: PCAR's management team is considered experienced (2.5 years average tenure).


Board Age and Tenure

9.2yrs

Average Tenure

63.5yo

Average Age

Experienced Board: PCAR's board of directors are considered experienced (9.2 years average tenure).


Insider Trading

Insider Buying: PCAR insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$100,34929 Oct 19
Douglas Grandstaff
EntityIndividual
Role
Chief Legal Officer
VP & General Counsel
Shares1,320
Max PriceUS$76.02
SellUS$200,19129 Oct 19
David Danforth
EntityIndividual
Shares2,640
Max PriceUS$75.83
SellUS$1,572,08529 Oct 19
Gary Moore
EntityIndividual
Role
Senior Key Executive
Executive Vice President
Shares20,739
Max PriceUS$75.80
SellUS$20,10630 Jul 19
Todd Hubbard
EntityIndividual
Shares280
Max PriceUS$71.81
SellUS$60,76829 Jul 19
David Danforth
EntityIndividual
Shares848
Max PriceUS$71.66
SellUS$40,15022 May 19
Douglas Grandstaff
EntityIndividual
Role
Chief Legal Officer
VP & General Counsel
Shares575
Max PriceUS$69.83
SellUS$19,67017 May 19
Todd Hubbard
EntityIndividual
Shares281
Max PriceUS$70.00
SellUS$200,32106 May 19
David Danforth
EntityIndividual
Shares2,835
Max PriceUS$70.66
SellUS$28,63321 Feb 19
Todd Hubbard
EntityIndividual
Shares418
Max PriceUS$68.50
SellUS$53,91508 Feb 19
Todd Hubbard
EntityIndividual
Shares820
Max PriceUS$66.00
SellUS$99,89505 Feb 19
David Danforth
EntityIndividual
Shares1,549
Max PriceUS$64.49

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Mark Pigott (65yo)

    Executive Chairman

    • Tenure: 22.9yrs
    • Compensation: US$2.79m
  • Harrie C. A. Schippers (56yo)

    President & CFO

    • Tenure: 1.9yrs
    • Compensation: US$3.95m
  • Jack LeVier (59yo)

    Vice President of Human Resources

    • Tenure: 12.5yrs
  • T. Quinn (57yo)

    Senior VP & CTO

    • Tenure: 1.7yrs
    • Compensation: US$1.87m
  • Gary Moore (63yo)

    Executive Vice President

    • Tenure: 4.9yrs
    • Compensation: US$4.46m
  • Darrin Siver (52yo)

    Senior Vice President

    • Tenure: 2.9yrs
  • R. Feight (51yo)

    CEO & Director

    • Tenure: 0.4yrs
    • Compensation: US$2.92m
  • A. Ley (53yo)

    VP & Chief Information Officer

    • Tenure: 2.9yrs
  • Ken Hastings

    Senior Director of Investor Relations

    • Tenure: 0yrs
  • Douglas Grandstaff (58yo)

    VP & General Counsel

    • Tenure: 2.1yrs

Board Members

  • Greg Spierkel (62yo)

    Independent Director

    • Tenure: 11.7yrs
    • Compensation: US$305.06k
  • Mark Pigott (65yo)

    Executive Chairman

    • Tenure: 22.9yrs
    • Compensation: US$2.79m
  • Chuck Williamson (70yo)

    Lead Director

    • Tenure: 5.9yrs
    • Compensation: US$330.06k
  • Beth Ford (55yo)

    Independent Director

    • Tenure: 4.7yrs
    • Compensation: US$280.06k
  • Rod McGeary (69yo)

    Independent Director

    • Tenure: 7.3yrs
    • Compensation: US$305.06k
  • Dame Alison Carnwath (66yo)

    Independent Director

    • Tenure: 14.2yrs
    • Compensation: US$290.06k
  • Kirk Hachigian (59yo)

    Independent Director

    • Tenure: 11yrs
    • Compensation: US$285.06k
  • Mark Schulz (66yo)

    Independent Director

    • Tenure: 7.7yrs
    • Compensation: US$290.06k
  • John Pigott (55yo)

    Director

    • Tenure: 10.7yrs
    • Compensation: US$265.06k
  • R. Feight (51yo)

    CEO & Director

    • Tenure: 0.4yrs
    • Compensation: US$2.92m

Company Information

PACCAR Inc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PACCAR Inc
  • Ticker: PCAR
  • Exchange: NasdaqGS
  • Founded: 1905
  • Industry: Construction Machinery and Heavy Trucks
  • Sector: Capital Goods
  • Market Cap: US$27.701b
  • Shares outstanding: 345.87m
  • Website: https://www.paccar.com

Number of Employees


Location

  • PACCAR Inc
  • 777 - 106th Avenue NE
  • Bellevue
  • Washington
  • 98004
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PCARNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMar 1970
PAISEAQ (SEAQ International)YesCommon StockGBGBPMar 1970
PAEDB (Deutsche Boerse AG)YesCommon StockDEEURMar 1970
PCARWBAG (Wiener Boerse AG)YesCommon StockATEURMar 1970
PAEETLX (Eurotlx)YesCommon StockITEURMar 1970
0KETLSE (London Stock Exchange)YesCommon StockGBUSDMar 1970

Biography

PACCAR Inc designs, manufactures, and distributes light, medium, and heavy-duty commercial trucks in the United States, Europe, and internationally. The company operates in three segments: Truck, Parts, an ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/07 23:41
End of Day Share Price2019/12/06 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.