Back to top

Image: Bigstock

Here's Why Paccar (PCAR) Fell More Than Broader Market

Read MoreHide Full Article

Paccar (PCAR - Free Report) closed at $111.56 in the latest trading session, marking a -1.09% move from the prior day. This change lagged the S&P 500's daily loss of 1.07%. Meanwhile, the Dow lost 0.51%, and the Nasdaq, a tech-heavy index, lost 1.69%.

Shares of the truck maker have appreciated by 16.82% over the course of the past month, outperforming the Auto-Tires-Trucks sector's gain of 1.87%, and the S&P 500's gain of 0.94%.

Analysts and investors alike will be keeping a close eye on the performance of Paccar in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $1.05, reflecting a 36.75% decrease from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $6.06 billion, indicating a 17.64% decline compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $5.01 per share and revenue of $26.05 billion. These totals would mark changes of -36.58% and -17.48%, respectively, from last year.

Investors should also take note of any recent adjustments to analyst estimates for Paccar. These revisions help to show the ever-changing nature of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.49% lower within the past month. Paccar is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note Paccar's current valuation metrics, including its Forward P/E ratio of 22.53. This signifies a premium in comparison to the average Forward P/E of 16.65 for its industry.

We can also see that PCAR currently has a PEG ratio of 15.43. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Automotive - Domestic industry held an average PEG ratio of 1.92.

The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. Currently, this industry holds a Zacks Industry Rank of 67, positioning it in the top 28% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


PACCAR Inc. (PCAR) - free report >>

Published in