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PCAR trades against a final fair-value range of $63.41-$124.84, with the midpoint set by the accepted valuation synthesis rather than earlier draft model outputs.
An extended freight recession depresses trucking rates, causing fleets to delay replacements indefinitely. Simultaneously, higher interest rates pressure the Financial Services segment, driving up delinquencies and compressing structural margins across the core business.
Freight rates remain depressed through 2026, causing fleets to cancel orders and delay equipment renewals indefinitely.
Operating margins compress severely below 8% despite the aftermarket parts buffer, destroying normalized profitability assumptions.
Sustained high interest rates spark a wave of defaults and delinquencies within the Financial Services segment portfolio.
| Line item | 2021-12-31 | 2022-12-31 | 2023-12-31 | 2024-12-31 | 2025-12-31 | Trend |
|---|---|---|---|---|---|---|
| Revenue | $23.52B | $28.82B+22.5% | $35.13B+21.9% | $33.66B-4.2% | $28.44B-15.5% | +4.9% |
| Gross profit | $4.28B | $5.23B | $7.73B | $6.71B | $4.74B | +2.6% |
| Operating income | $2.31B | $3.68B | $5.95B | $4.89B | $2.96B | +6.4% |
| Net income | $1.87B | $3.01B+61.0% | $4.60B+52.8% | $4.16B-9.6% | $2.38B-42.8% | +6.2% |
| EPS (diluted) | $3.55 | $5.75 | $8.76 | $7.90 | $4.51 | +6.2% |
| EBITDA | $3.28B | $4.47B | $6.87B | $5.81B | $3.79B | +3.7% |
| R&D | $324.1M | $341.2M | $410.9M | $452.9M | $445.5M | +8.3% |
| SG&A | $676.8M | $726.3M | $753.3M | $744.0M | $735.8M | +2.1% |
Cash-flow quality is reflected in the OCFOperating cash flowCash generated from the company's core operations after working-capital changes but before capital expenditures. The first line of the cash-flow statement. / net incomeNet IncomeNet Income is an income-statement line item used to reconcile revenue to operating profit, pre-tax income, net income, or per-share earnings. It should be compared across periods and against peer disclosure conventions., accounting-quality, and ROICROICReturn on invested capital. Operating profit (after tax) divided by invested capital. The single best gauge of capital-efficiency. Spread over WACC = economic value created. rows above.
Capital allocation should be evaluated against reinvestment needs, balance-sheet strength, and shareholder returns.
| Deterioration versus the report thesis |
| Material uptick in captive finance portfolio delinquencies. | Monitor | Deterioration versus the report thesis |
| Substantial delay or cancellation of anticipated replacement cycles. | Monitor | Deterioration versus the report thesis |
