Key Stats for PACCAR Stock
- Past week’s performance: stayed flat
- 52-week range: $85 to $132
- Valuation model target price: $170
- Implied upside: 34% over 2.9 years
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What Happened?
Shares of commercial truck manufacturer PACCAR (PCAR) were little changed this week, and they closed near $127.
The stock remains close to all-time highs, but trading has been quiet since the company reported 2025 results on January 27.
PACCAR delivered very good annual revenues and net income for 2025. However, fourth-quarter profits declined because truck demand stayed soft as fleets worked through excess inventory.
Management highlighted improving conditions ahead, and they forecast U.S. and Canadian Class 8 truck sales of 230,000–270,000 units in 2026. So, investors focused on that potential rebound and pre-buy activity before 2027 emissions rules.
Some executives sold shares after exercising options, but these moves appeared routine.
Overall, no major new developments emerged this week. So, the stability reflects confidence in the longer-term outlook rather than immediate catalysts.
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Is PACCAR Stock Undervalued?
Under valuation model assumptions realized through 12/31/28, the stock is modeled using:
- Revenue growth (CAGR): 7.1%
- Operating margins: 12.0%
- Exit P/E multiple: 20.7x
Based on these inputs, the model estimates a target price of $170.17, implying 33.6% total upside from the current share price and a 10.5% annualized return over the next 2.9 years.
Truck volume recovery remains the biggest driver, because higher deliveries lift revenue quickly and improve operating leverage. The aftermarket parts segment offers stability, and it benefits from a growing installed base of vehicles.
Financial services also generate steady profits, so it supports overall margins during cyclical swings. Potential pre-buy demand ahead of stricter 2027 EPA standards could accelerate sales in 2026 and 2027, but timing depends on fleet behavior.
If PACCAR maintains market share and cost discipline, the assumptions look achievable. So, the current price embeds moderate execution risk rather than excessive optimism.
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