PACCAR Inc Faces Earnings Challenge Ahead of Q4 Report
With a market capitalization of $55 billion, PACCAR Inc (PCAR) specializes in designing and manufacturing light, medium, and heavy-duty commercial trucks. Based in Bellevue, Washington, the company also produces diesel engines and powertrain components, both for its own vehicles and for third-party truck and bus manufacturers. Investors are keenly awaiting the announcement of its fiscal Q4 earnings results, which is scheduled to come out before the market opens on Tuesday, Jan. 28.
Analysts Predict Profit Drop for Upcoming Earnings
Expectations for PACCAR’s earnings reveal a projected profit of $1.67 per share for the upcoming quarter, representing a significant decrease of 38.2% compared to $2.70 per share from the same quarter last year. In recent quarters, the company has surprised analysts by beating earnings estimates three out of four times, with its last quarter’s earnings of $1.85 surpassing forecasts by approximately 1.7%.
Projections for Fiscal 2024 Earnings
Looking ahead to fiscal 2024, analysts anticipate the company will report earnings per share (EPS) of $7.92, which is down 17.6% from the $9.61 reported in fiscal 2023.
Stock Performance Comparisons
Over the past 52 weeks, PACCAR’s shares have risen by 14.6%. However, it has lagged behind broader market gains as the S&P 500 Index ($SPX) increased by 27.2%, and the Industrial Select Sector SPDR Fund (XLI) saw a return of nearly 18.9% during the same period.
On October 22, PACCAR’s stock experienced a sharp drop of 4.4% following its Q3 earnings report, which showed better-than-expected results of $1.85 per share and adjusted revenues of $7.7 billion. Despite these strong numbers, a 20.9% year-over-year decline in earnings—largely due to increased costs and constraints from suppliers—as well as a 5.3% decrease in consolidated revenues to $8.2 billion contributed to negative investor sentiment. The revenue decline was largely driven by an 8.8% drop in the Trucks segment, particularly impacted by weakness in the European used truck market.
Analyst Ratings and Price Target
Wall Street analysts maintain a moderately positive outlook on PACCAR’s stock, assigning it a “Moderate Buy” rating overall. Of the 15 analysts covering the stock, four advocate for a “Strong Buy,” one for a “Moderate Buy,” nine suggest a “Hold,” and one recommends a “Strong Sell.”
The average price target set by analysts for PCAR is $117.61, indicating a potential upside of 9.7% from current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
