We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is PACCAR (PCAR) Down 3.5% Since the Last Earnings Report?
Read MoreHide Full Article
It has been about a month since the last earnings report for PACCAR Inc. (PCAR - Free Report) . Shares have lost about 3.5% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
PACCAR Q3 Earnings Drive Past Estimates, Grow Y/Y
PACCAR’s third-quarter 2017 earnings were $1.14 per share, up from 98 cents recorded in the year-ago quarter. Earnings surpassed the Zacks Consensus Estimate of $1.09. Results benefited from a strong European market, increasing market share in North America and global higher market sales.
Net sales and financial services revenues increased to $5.06 billion from $4.25 billion recorded in third-quarter 2016.
Segment Results
Revenues from the Truck, Parts and Other segment increased to $4.73 billion in third-quarter 2017 from $3.95 billion in third-quarter of 2016. The segment’s pre-tax income increased to $501.6 million in comparison to $415.4 million, recorded a year ago.
Revenues in the Financial Services segment (comprising a portfolio of 184,000 trucks and trailers with total assets of $13.06 billion) rose to $328.2 million, from $296.2 million. Pre-tax income in the segment increased to $71.2 million from $71 million in the year-ago quarter.
Financial Position
PACCAR’s cash and marketable debt securities amounted to $3.4 billion as of Sep 30, 2017 compared with $2.9 billion as of Dec 31, 2016.
Guidance
The company increased the Class 8 industry retail sales estimates in the United States and Canada to be within 210,000-220,000 compared with the previous expectation of 200,000-220,000 vehicles for 2017.
Also, for 2018, the company expects the Class 8 truck industry retail sales estimates for the United States and Canada to be within the range of 220,000-250,000 vehicles.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter compared to one lower. While looking back an additional 30 days, we can see even more upward momentum. In the past month, the consensus estimate has shifted by 5.6% due to these changes.
VGM Scores
At this time, PACCAR's stock has a poor Growth Score of F, however its momentum is doing a lot better with a C. The stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for value investors than momentum investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. It comes with little surprise that the stock has a Zacks Rank #1 (Strong Buy).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is PACCAR (PCAR) Down 3.5% Since the Last Earnings Report?
It has been about a month since the last earnings report for PACCAR Inc. (PCAR - Free Report) . Shares have lost about 3.5% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
PACCAR Q3 Earnings Drive Past Estimates, Grow Y/Y
PACCAR’s third-quarter 2017 earnings were $1.14 per share, up from 98 cents recorded in the year-ago quarter. Earnings surpassed the Zacks Consensus Estimate of $1.09. Results benefited from a strong European market, increasing market share in North America and global higher market sales.
Net sales and financial services revenues increased to $5.06 billion from $4.25 billion recorded in third-quarter 2016.
Segment Results
Revenues from the Truck, Parts and Other segment increased to $4.73 billion in third-quarter 2017 from $3.95 billion in third-quarter of 2016. The segment’s pre-tax income increased to $501.6 million in comparison to $415.4 million, recorded a year ago.
Revenues in the Financial Services segment (comprising a portfolio of 184,000 trucks and trailers with total assets of $13.06 billion) rose to $328.2 million, from $296.2 million. Pre-tax income in the segment increased to $71.2 million from $71 million in the year-ago quarter.
Financial Position
PACCAR’s cash and marketable debt securities amounted to $3.4 billion as of Sep 30, 2017 compared with $2.9 billion as of Dec 31, 2016.
Guidance
The company increased the Class 8 industry retail sales estimates in the United States and Canada to be within 210,000-220,000 compared with the previous expectation of 200,000-220,000 vehicles for 2017.
Also, for 2018, the company expects the Class 8 truck industry retail sales estimates for the United States and Canada to be within the range of 220,000-250,000 vehicles.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter compared to one lower. While looking back an additional 30 days, we can see even more upward momentum. In the past month, the consensus estimate has shifted by 5.6% due to these changes.
VGM Scores
At this time, PACCAR's stock has a poor Growth Score of F, however its momentum is doing a lot better with a C. The stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for value investors than momentum investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. It comes with little surprise that the stock has a Zacks Rank #1 (Strong Buy).