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Analysts there told investors in a note that the shifting sentiment will unlock valuation upside in the shares.
“We believe chances for a meaningful truck downturn in 2024 are fading, and we continue to expect strong industry growth in 2025-26 ahead of 2027 emissions regulations,” the analysts wrote.
The analysts said that they are long-term fans of PCAR based on the company’s premium products and returns, and that with improved industry dynamics, “2025/26 could be huge.”
“Yes, we are a bit late. PCAR shares are up 30% ytd and up nearly 12% relative to the S&P 500. With a #2 market share position in NA, PCAR delivers premium operating margins. Still, shares trade at just ~7x our 2024E EV/EBITDA vs the cycle range of 6-13,” added the analysts. “We believe there is strong truck cycle visibility through 2026.”
