Comparing PACCAR (PCAR) and Its Competitors

PACCAR (NASDAQ: PCAR) is one of 15 public companies in the “Heavy Machinery & Vehicles” industry, but how does it compare to its peers? We will compare PACCAR to similar businesses based on the strength of its dividends, analyst recommendations, valuation, institutional ownership, earnings, risk and profitability.

Profitability

This table compares PACCAR and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PACCAR 7.61% 18.77% 6.33%
PACCAR Competitors 4.06% 13.41% 3.96%

Dividends

PACCAR pays an annual dividend of $1.00 per share and has a dividend yield of 1.4%. PACCAR pays out 25.6% of its earnings in the form of a dividend. As a group, “Heavy Machinery & Vehicles” companies pay a dividend yield of 1.3% and pay out 33.7% of their earnings in the form of a dividend. PACCAR is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Risk & Volatility

PACCAR has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500. Comparatively, PACCAR’s peers have a beta of 1.43, indicating that their average share price is 43% more volatile than the S&P 500.

Earnings & Valuation

This table compares PACCAR and its peers revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
PACCAR $17.03 billion $521.70 million 17.98
PACCAR Competitors $6.06 billion $48.37 million 116.55

PACCAR has higher revenue and earnings than its peers. PACCAR is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Analyst Ratings

This is a summary of current ratings and recommmendations for PACCAR and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PACCAR 1 13 8 0 2.32
PACCAR Competitors 171 885 965 17 2.41

PACCAR currently has a consensus price target of $75.17, indicating a potential upside of 7.20%. As a group, “Heavy Machinery & Vehicles” companies have a potential upside of 7.97%. Given PACCAR’s peers stronger consensus rating and higher probable upside, analysts clearly believe PACCAR has less favorable growth aspects than its peers.

Institutional & Insider Ownership

62.4% of PACCAR shares are owned by institutional investors. Comparatively, 82.2% of shares of all “Heavy Machinery & Vehicles” companies are owned by institutional investors. 2.6% of PACCAR shares are owned by company insiders. Comparatively, 8.9% of shares of all “Heavy Machinery & Vehicles” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

PACCAR peers beat PACCAR on 8 of the 15 factors compared.

About PACCAR

PACCAR Inc (PACCAR) is a technology company. The Company’s segments include Truck, Parts and Financial Services. The Truck segment includes the design, manufacture and distribution of light-, medium- and heavy-duty commercial trucks. The Company’s trucks are marketed under the Kenworth, Peterbilt and DAF nameplates. It also manufactures engines, primarily for use in the Company’s trucks, at its facilities in Columbus, Mississippi; Eindhoven, the Netherlands, and Ponta Grossa, Brazil. The Parts segment includes the distribution of aftermarket parts for trucks and related commercial vehicles. The Financial Services segment includes finance and leasing products and services provided to customers and dealers. Its Other business includes the manufacturing and marketing of industrial winches. The Company operates in Australia and Brazil and sells trucks and parts to customers in Asia, Africa, Middle East and South America.

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