PACCAR (PCAR) Stock Forecast & Price Target

PACCAR is poised for consistent growth, forecasting a 4-6% increase in business for the third quarter, bolstered by investments in capacity, enhanced services, and an improved parts sales market despite a flat overall parts environment. The company's FY2026 outlook anticipates a 5% year-over-year rise in Class 8 industry retail sales in the U.S. and Canada, positioning the midpoint at 250,000 units, demonstrating clear expectations for market demand stability. Additionally, PACCAR's parts business recorded sales of $1.725 billion, reflecting a year-over-year increase of 4%, which underscores the resilience of this segment amidst challenging market conditions.

Paccar's operating margins have experienced significant declines, with a drop of 490 basis points to 8.3% compared to the previous year, reflecting widening profitability challenges. New truck deliveries in the second quarter of 2025 fell by 18.8% to 39,300 units, and forecasts indicate a further decline to 32,000-33,000 units in the upcoming quarter due to seasonal shutdowns and adjusted production rates. Regionally, the company's performance varied greatly, with North American deliveries down 34%, contrasting with a modest 1% increase in Europe, while South America saw a steep decline of 48%.