Washington-based PACCAR Inc (PCAR) designs, manufactures, and distributes light, medium, and heavy-duty commercial trucks. Valued at a market cap of $56.1 billion, the company also designs and manufactures diesel engines and other powertrain components for use in its own products and for sale to third-party manufacturers of trucks and buses.

This commercial truck manufacturer’s shares have massively lagged behind the broader market over the past 52 weeks. PACCAR has gained 3.3% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 22.8%. The stock is up 3.5% on a YTD basis, almost mirroring the SPX’s 3.4% rise during the same time frame.

Zooming in further, PCAR has underperformed the Industrial Select Sector SPDR Fund’s (XLI) 18.8% return over the past 52 weeks and a 4.5% gain on a YTD basis. 

On Jan. 28, shares of PCAR closed down 2.4% after its weaker-than-expected Q4 earnings release. The company reported adjusted earnings of $1.66 per share, which fell 38.5% from the year-ago quarter and missed the Wall Street estimates of $1.68. Revenue was also disappointing, coming in at $7.4 billion, down 14.3% year-over-year and missing forecasts by 1.1%. The underwhelming performance can be primarily attributed to unfavorable foreign exchange rates, which reduced net income by approximately $20 million, and weaker demand in the European truck market. Additionally, declines across PCAR’s key revenue generators—trucks, parts, and other segments, further contributed to the downtick.

For the current fiscal year, ending in December 2025, analysts expect PCAR’s EPS to decline 3.8% year over year to $7.60. The company’s earnings surprise history is mixed. It surpassed the Wall Street estimates in two of the last four quarters while missing on two other occasions. 

Among the 15 analysts covering the stock, the consensus rating is a “Moderate Buy,” which is based on six “Strong Buy,” eight “Hold,” and one “Strong Sell” rating. 

This configuration is more bullish than three months ago, with four analysts suggesting a “Strong Buy” rating. 

On Feb. 3, JPMorgan maintained an “Overweight” rating on Paccar and raised its price target to $132 - the Street high price target, which indicates a healthy 22.6% potential upside from the current levels. 

The mean price target of $117.7 represents a modest 9.3% upside from PCAR’s current price levels.