Key Stats for PACCAR Stock
- 6-Month Performance: 24%
- 52-Week Range: $85 to $132
- Valuation Model Target Price: $150
- Implied Upside: 20%
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What Happened?
PACCAR stock has risen about 24% over the last six months, recently trading near $125 per share as investors responded to stabilizing freight conditions, clearer regulatory visibility, and continued structural profit expansion.
The move higher reflects growing confidence that 2026 could deliver stronger cycle-over-cycle earnings as truck markets normalize.
The rally has been driven primarily by reaffirmed 2026 guidance and improving per-truck profitability expectations.
At its 2026 Investor Conference, PACCAR reported 2025 revenue of $28.4 billion, adjusted net income of $2.6 billion, and 144,200 trucks delivered, while generating $4.4 billion in operating cash flow and a record 55.5% return on invested capital.
CEO Preston Feight pointed to improving conditions heading into the new year, stating that “2026 should be better,” as freight trends strengthen and regulatory uncertainty eases.
Management guided for first quarter 2026 deliveries of about 33,000 units with gross margins of 12.5% to 13% and full-year parts sales growth of 4% to 8%, reinforcing expectations that earnings durability remains intact.
Institutional positioning has also supported the advance. Vanguard increased its stake by 0.8% to 63.1 million shares, representing about 12.02% of the company valued at $6.21 billion.
NEOS Investment Management raised its position by 57.6% in the third quarter, while Caprock Group and Machina Capital initiated new positions.
Although BNP Paribas Asset Management reduced its holdings by 15.6% and Alps Advisors trimmed its stake by 44.2%, overall institutional ownership remains near 64.9%, signaling continued large-scale investor participation.
Insider activity has been more mixed. Over the last 90 days, insiders sold 130,905 shares valued at about $16.6 million, including EVP C. Michael Dozier’s sale of 79,076 shares and EVP Kevin D. Baney’s sale of 9,672 shares.
CFO Brice Poplawski also sold 2,200 shares at an average price of $130.41. Despite those transactions, the stock’s recent strength suggests investors are focusing more on improving freight fundamentals, margin resilience, and long-term parts growth heading into 2026.
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Is PACCAR Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 7.3%
- Operating Margins: 12%
- Exit P/E Multiple: 18x
Revenue is projected to rise from about $27.6 billion in 2026 to roughly $39.6 billion by 2030, reflecting gradual recovery in truck production, expanding parts penetration, and steady financial services income rather than aggressive volume growth alone.
Parts and financial services now account for 71% of profit, materially reducing cyclicality compared to prior truck cycles.
The global parts opportunity remains significant, with a $70 billion addressable market across North America and Europe, and management continues investing in distribution, AI-driven inventory management, and connected truck analytics to capture additional share, particularly among second owners.
Manufacturing flexibility also plays a central role. Over the past five years, PACCAR invested more than $5 billion in facilities and products, enhancing local-for-local production and improving factory efficiency.
That flexibility supports margin durability even as product mix shifts between diesel, electric, and hybrid platforms over time.
Based on these inputs, the model estimates a target price of $150, implying about 20% total upside over the next few years.
At current levels, PACCAR appears modestly undervalued, with 2026 performance likely driven by improving freight demand, continued parts growth, disciplined capital allocation, and incremental gains in profit per truck rather than a sharp rebound in volumes alone.
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