PACCAR (PCAR) Stock Forecast & Price Target

PACCAR is positioned for growth, with expectations of a 4-6% increase in business in the third quarter, driven by investments in capacity and services, as well as a strong parts market influenced by higher shipping days in Europe. The company has introduced its FY2026 outlook, forecasting North American Class 8 industry retail sales to rise by approximately 5% year-over-year, reflecting robust market dynamics and continued share expansion in the heavy-duty and medium-duty sectors. Significant sales performance in the parts segment is notable, with year-over-year growth of 3.4% to $1.721 billion, exceeding management's forecasts, further enhancing PACCAR's positive financial outlook.

Paccar has faced a significant decline in operating margins, with a drop of 490 basis points to 8.3%, reflecting a notable deterioration in profitability. In the second quarter of 2025, new truck deliveries decreased by 18.8% to 39,300 units, and forecasts indicate a further drop to 32-33K in the third quarter, driven by seasonal shutdowns in Europe and adjusted production rates in North America. Furthermore, the disparities in regional deliveries reveal a staggering 34% decline in North America and a substantial 48% drop in South America, which could adversely impact the company’s overall sales performance moving forward.