PACCAR Inc (PCAR) — Company Research
Last Updated: 4 July 2026
PACCAR Inc (NASDAQ: PCAR) is a global technology leader in the design, manufacture and customer support of premium light-, medium- and heavy-duty trucks under the Kenworth, Peterbilt and DAF nameplates. The Bellevue, Washington company also runs a large aftermarket parts business and a captive finance arm, and 2025 marked its 87th consecutive year of net income — through one of the sharper truck-cycle downturns in recent memory. This report presents the facts from primary sources — company press releases, SEC filings and official data — with no analyst opinions.
1. Company Snapshot
| Field | Value |
|---|---|
| Company | PACCAR Inc |
| Ticker / Exchange | PCAR / NASDAQ |
| Sector | Industrials — heavy-duty truck manufacturing, parts and financial services |
| Headquarters | Bellevue, Washington, USA |
| CEO | Preston Feight (Chief Executive Officer); Mark Pigott is Executive Chairman |
| Employees | ~25,900 (31 Dec 2025; ~40% in the US) |
| Brands | Kenworth, Peterbilt, DAF; PACCAR Parts, PACCAR Financial, PACCAR Powertrain |
| Revenue (FY2025) | $28,444.8m (−15.5%) |
| Net income (FY2025) | $2,375.8m GAAP; adjusted net income $2,644m (excluding EU litigation charge) |
| Market cap | ~$62.8bn (2 Jul 2026, at $119.49) |
| Dividend | $0.35/quarter (raised Apr 2026) plus year-end extra dividend ($1.40 paid Jan 2026) |
| Fiscal year end | 31 December |
2. Bull and Bear Case
Bull Case
- Premium truck franchise: Kenworth and Peterbilt held a 30% share of US and Canada Class 8 retail sales in 2025, and DAF's XD and XF Electric won International Truck of the Year 2026; 2025 was PACCAR's 87th consecutive profitable year.
- Resilient aftermarket engine: PACCAR Parts delivered record 2025 revenue of $6.87bn and $1.67bn of pretax income — high-margin, counter-cyclical profits that cushion truck-cycle troughs.
- Fortress balance sheet: $9.5bn of cash and marketable securities at year-end 2025 with essentially no manufacturing debt; borrowings sit in the captive finance arm against a $22.8bn asset portfolio.
- Cycle recovery setup: Q1 2026 net income rose 19.8% to $605.3m with gross margin up to 13.1%; management cites tariff and EPA27 emissions clarity plus improving freight fundamentals, and guided 2026 US/Canada Class 8 industry sales of 230,000–270,000 trucks.
- Tariff positioning: PACCAR builds trucks in the US, Canada and Mexico for local markets, minimising costs under the Section 232 truck tariffs that took effect in November 2025.
Bear Case
- Deep cyclicality: Revenue fell 15.5% in 2025 after a 4.2% decline in 2024, and Q1 2026 revenue was still down 8.9% year-on-year; GAAP EPS nearly halved from the 2023 peak ($8.76 to $4.51).
- Margin pressure: Company gross margin of ~13% remains well below the 2023 cycle peak; weak used-truck prices and competitive pricing cap near-term recovery.
- EU litigation overhang: A $264.5m after-tax non-recurring charge for European civil litigation hit 2025 results, and related claims may not be fully resolved.
- Captive finance risk: PACCAR Financial's $22.8bn portfolio carries credit and residual-value risk; a freight recession or falling used-truck values would pressure PFS earnings.
- EV transition cost: Battery-electric and autonomous truck programmes require sustained R&D and capital investment ($1.17bn combined in 2025) with uncertain adoption timing.
3. Business Segments
Segment shares below are FY2025, from PACCAR's 2025 Annual Report (Form 10-K).
| Segment | % of revenue | What it is |
|---|---|---|
| Truck | ~68% (~$19.3bn) | Design, manufacture and sale of Kenworth, Peterbilt and DAF light-, medium- and heavy-duty trucks; 144,200 vehicles delivered worldwide in 2025 |
| Parts | ~24% ($6,870m) | Aftermarket parts distribution through 21 global distribution centres, 2,000+ dealers and 350+ TRP stores; record revenue in 2025 |
| Financial Services | ~8% (~$2,240m) | PACCAR Financial — retail loans and leases for trucks, dealer financing and PacLease; $22.8bn of assets and $485.4m pretax income in 2025 |
4. Business Model
How PACCAR makes money. PACCAR sells premium trucks through independent Kenworth, Peterbilt and DAF dealers, monetises the installed fleet through high-margin aftermarket parts (sold via dealers and TRP stores), and finances truck purchases through PACCAR Financial, which earns a spread on its $22.8bn loan and lease portfolio. Truck revenue is cyclical; Parts and Financial Services provide foundational profitability through all phases of the cycle — in 2025, Parts alone generated $1.67bn of pretax income while truck deliveries fell.
Unit economics. The premium positioning of Kenworth, Peterbilt and DAF supports above-industry pricing, and vertical integration in powertrains (PACCAR MX engines) captures more value per vehicle. After-tax return on revenues was 8.4% in 2025 even at the cycle trough. Capital investments of $743.0m plus R&D of $445.5m in 2025 fund new models, robotic manufacturing and battery-electric programmes.
Moat. Brand strength and residual values, a dealer network exceeding 2,300 points of sale and service, captive financing, and 87 consecutive profitable years evidence a durable franchise. The dividend policy targets roughly 50% of net income paid out via regular and year-end extra dividends.
5. Financial Health
All figures from PACCAR earnings press releases and SEC filings (calendar fiscal years). Per-share figures are adjusted for the 50% stock dividend distributed in February 2023.
| Fiscal Year | Revenue ($m) | YoY % | GAAP EPS | Adjusted EPS | Dividend/share | Long-term debt (YE, $m) |
|---|---|---|---|---|---|---|
| 2021 | $23,522.3m | +25.6% | $3.57 | $3.57¹ | $1.89² | $7,128.8m³ |
| 2022 | $28,819.7m | +22.5% | $5.75 | $5.75¹ | $2.80 | $7,866.7m³ |
| 2023 | $35,127.4m | +21.9% | $8.76 | $8.76¹ | $4.24 | $8,624.6m³ |
| 2024 | $33,663.8m | −4.2% | $7.90 | $7.90¹ | $4.17 | $9,891.2m³ |
| 2025 | $28,444.8m | −15.5% | $4.51 | $5.01 | $2.72 | $10,646.8m³ |
¹ PACCAR reported no non-GAAP adjustments in 2021–2024; adjusted EPS equals GAAP EPS. 2025 adjusted EPS excludes the $264.5m after-tax European civil litigation charge. ² Dividends declared in 2021 were $2.84 per pre-split share, shown here adjusted for the February 2023 50% stock dividend. ³ Long-term debt is PACCAR Financial Services term notes; the truck and parts (manufacturing) business carries no long-term debt.
| Quarter | Revenue ($m) | Adjusted EPS | GAAP EPS |
|---|---|---|---|
| Q1 2026 | $6,780m | $1.15 | $1.15 |
| Q4 2025 | $6,820m | $1.06 | $1.06 |
| Q3 2025 | $6,670m | $1.12 | $1.12 |
| Q2 2025 | $7,510m | $1.37 | $1.37 |
| Q1 2025 | $7,440m | $1.46 | $0.96 |
| FY2025 total | $28,444.8m | $5.01 | $4.51 |
At 31 December 2025 PACCAR held $6,307.9m of cash and equivalents plus $3,207.7m of marketable securities. Financial Services borrowings comprised $4,989.5m of commercial paper and bank loans and $10,646.8m of term notes. FY2025 cash provided by operations was $4,415.8m, capital expenditure (property, plant and equipment) $743.0m, and depreciation and amortisation totalled ~$1,225.6m ($398.2m on PP&E plus $827.4m on operating-lease equipment and other). Dividends declared in 2025 totalled $1.43bn.
6. Valuation
Raw metrics, July 2026. Not opinions on whether the stock is cheap or expensive.
| Metric | Value |
|---|---|
| Market cap | ~$62.8bn (2 Jul 2026, at $119.49) |
| Enterprise value | ~$68.9bn (market cap ~$62.8bn + total borrowings $15,636.3m − cash and marketable securities $9,515.6m per 31 Dec 2025 balance sheet; note that effectively all debt funds the PACCAR Financial portfolio) |
| Trailing P/E (GAAP) | ~25.4x ($119.49 / TTM GAAP EPS ~$4.70 to Q1 2026; ~26.5x on FY2025 EPS $4.51) |
| P/E (forward) | n/a — PACCAR does not issue EPS guidance |
| P/S (TTM) | ~2.3x (market cap ~$62.8bn / TTM revenue ~$27.8bn to Q1 2026) |
| EV/EBITDA (TTM) | ~16.2x (EV ~$68.9bn / FY2025 EBITDA ~$4,249m; EBITDA = pretax income $3,023.5m + D&A $1,225.6m — consolidated basis including Financial Services) |
| P/FCF | ~17.1x (market cap ~$62.8bn / FY2025 FCF ~$3,672.8m; FCF = operating cash flow $4,415.8m − capex $743.0m per FY2025 cash flow statement) |
| 52-week high | $131.88 |
| 52-week low | $92.25 |
| Short interest (% of float) | ~2.1% (~11.2m shares short; MarketBeat/StockAnalysis, June 2026) |
| Days to cover | ~3.3 (recent average daily volume) |
7. What Are They Building
PACCAR invested $743.0m in capital projects and $445.5m in R&D during 2025, focused on next-generation clean powertrains, battery-electric trucks and advanced manufacturing. Kenworth and Peterbilt introduced next-generation battery-electric trucks in 2025, while DAF's XD and XF Electric models won International Truck of the Year 2026 for their energy efficiency, range and battery technology. In the first quarter of 2026 DAF introduced the new XG and XG+ Electric long-haul trucks and Kenworth unveiled the vocational C580 at CONEXPO.
On the manufacturing side, Kenworth is constructing a 46,000 sq. ft. robotic chassis paint facility in Chillicothe, Ohio, and PACCAR built a 50,000 sq. ft. engine remanufacturing facility in Mississippi. PACCAR Parts opened a new 180,000 sq. ft. distribution centre in Calgary, Canada — its 21st global PDC. The company is also embedding AI across its business, and its powertrain roadmap is aligned with the EPA's re-affirmed EPA27 NOx limit of 35 milligrams, which management says provides buying-decision clarity for customers.
8. Competitive Landscape
PACCAR competes globally in heavy- and medium-duty trucks and engines. Market caps are as of the dates shown; each metric is from the peer's own reported results.
| Peer | Market cap (Month Year) | Key 2025 metric |
|---|---|---|
| Volvo Group (STO: VOLV-B) | ~$68.7bn (Jun 2026) | 2025 net sales SEK 479.2bn (~€43bn), adjusted operating margin 10.7% |
| Daimler Truck (ETR: DTG) | ~$35.4bn (May 2026) | 2025 industrial revenue €45.9bn; adjusted EBIT €3,778m |
| Cummins (NYSE: CMI) | ~$91.0bn (Jun 2026) | 2025 revenue $33.7bn (−1%); EBITDA 16.0% of sales |
Kenworth and Peterbilt's combined 30% US/Canada Class 8 retail share in 2025 puts PACCAR head-to-head with Daimler Truck's Freightliner (the segment leader), Volvo/Mack, and Traton's International. In Europe, DAF competes with Volvo/Renault Trucks, Mercedes-Benz Trucks, Scania and MAN. Cummins is both a competitor to and supplier alongside PACCAR's own MX engine line.
9. Leadership & Insider Activity
Preston Feight is Chief Executive Officer and Mark Pigott is Executive Chairman. Recent SEC Form 4 filings (May–June 2026) show only routine dividend reinvestments through the PACCAR Savings Investment Plan — CEO Preston Feight (53.7 shares at $114.38 on 5 Jun 2026), Executive Chairman Mark Pigott (533.7 shares), general counsel Michael Walton and CTO John Rich all filed similar SIP entries.
There were no material insider open-market purchases or sales reported in the past quarter — no material insider transactions beyond automatic plan activity. Sources: SEC Form 4 filings via EDGAR/StockTitan, July 2026.
10. Key Risks
- Truck-cycle downturn (Macro): Class 8 demand is deeply cyclical — PACCAR revenue fell 15.5% in 2025 and Q1 2026 was still down 8.9% year-on-year; a freight recession would delay the recovery management expects in 2026.
- Tariffs and trade policy (Regulatory): Section 232 truck tariffs took effect in November 2025; while PACCAR's local-production footprint minimises exposure, supply-chain cost inflation and retaliatory measures remain risks.
- European litigation (Legal): PACCAR took a $264.5m after-tax charge in 2025 for EU civil litigation tied to the historic trucks cartel case; further claims could bring additional charges.
- Captive finance credit and residual values (Financial): PACCAR Financial's $22.8bn portfolio is exposed to customer defaults and used-truck price deflation, which also affects trade-in economics for new truck sales.
- Emissions regulation and EV transition (Regulatory): EPA27 NOx compliance, EU CO2 targets and the shift to battery-electric powertrains require heavy investment with uncertain customer adoption rates.
- Competition (Competitive): Daimler Truck, Volvo Group, Traton and emerging EV entrants compete on price, technology and total cost of ownership in every major market.
11. Recent Developments
- 28 Apr 2026 — Q1 2026 results: net income +19.8% to $605.3m. Revenue was $6.78bn (down 8.9% year-on-year) but gross margin improved to 13.1% from 12%, PACCAR Parts earned $402.3m pretax and PACCAR Financial $115.5m. Management guided Q2 gross margin to around 13.5% on higher global production and projected 2026 US/Canada Class 8 industry sales of 230,000–270,000 units.
- 28 Apr 2026 — Regular quarterly dividend raised 6% to $0.35 per share. The board lifted the quarterly payout from $0.33, payable 3 June 2026; PACCAR has paid out roughly 50% of net income in dividends for many years.
- 27 Jan 2026 — FY2025 results: 87th consecutive profitable year. Revenue was $28.44bn with net income of $2.38bn ($4.51/share) and adjusted net income of $2.64bn ($5.01/share) — the fourth best in company history — despite the $264.5m EU litigation charge. Record Parts revenue of $6.87bn and record Financial Services revenue were highlights.
- 1 Dec 2025 — DAF XD and XF Electric named International Truck of the Year 2026. The award, announced at the Solutrans exhibition in Lyon, was PACCAR's third International Truck of the Year honour in five years, recognising energy efficiency, range and battery technology.
12. Key Dates & Catalysts
- 28 Jul 2026 — Q2 2026 earnings release (before US market open), covering the June 2026 quarter
- Expected September 2026 — next regular quarterly dividend of $0.35 per share (PACCAR pays in March, June, September and December)
- Expected October 2026 — Q3 2026 earnings release
- Expected January 2027 — FY2026 results and declaration of the year-end extra cash dividend
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Disclaimer: This research is produced by ChartsView for educational and informational purposes only. It does not constitute financial advice or a recommendation to buy or sell any security. All information is sourced from publicly available company filings, press releases, and official data. ChartsView does not use analyst opinions or third-party ratings. Always conduct your own due diligence and consider your personal financial situation before making investment decisions. Past performance is not indicative of future results.
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13. Thesis Verdict
The central thesis. PACCAR designs and builds premium Kenworth, Peterbilt and DAF trucks, monetises the installed fleet through a record $6.87bn aftermarket Parts business, and finances customers via its $22.8bn PACCAR Financial portfolio. 2025 revenue fell 15.5% to $28.44bn at the truck-cycle trough, yet net income of $2.38bn ($4.51/share; adjusted $5.01) marked an 87th consecutive profitable year, and Q1 2026 net income rose 19.8% to $605.3m with gross margin improving to 13.1%. Management projects 2026 US/Canada Class 8 industry sales of 230,000–270,000 trucks, citing tariff and EPA27 emissions clarity plus improving freight fundamentals as the near-term recovery drivers.
What would confirm or break it. Confirmation would come from the Q2 2026 report (28 July 2026) delivering the guided ~13.5% gross margin on higher global production, alongside continued order momentum. The thesis breaks if the freight recovery stalls — extending the two-year revenue decline — or if used-truck price deflation stresses PACCAR Financial’s portfolio and further EU litigation charges emerge, the key bear-case risks.
Watchpoints
- ConfirmsQ2 2026 earnings (24 days) landing in line with or above management guidance.
- ConfirmsEvidence supporting the "Premium truck franchise:" thesis continuing to build across subsequent filings.
- InvalidatesMaterialisation of the "Truck-cycle downturn (Macro):" risk, or any disclosure that fundamentally alters the capital-return or growth profile stated by management.
Diagnostic grid
Generated by ChartsView research tooling. Thesis strength measures how well the evidence in this report supports the company's stated thesis — it is NOT a buy/sell rating or price target. ChartsView is not authorised by the FCA to provide regulated investment advice. Generated 4 Jul 2026.