Nasdaq-100® Inside the Index: PACCAR (PCAR)
Key Figures
- $31.6B — FY2024 revenue
- $1.75B — Record parts revenue (Q2 2026)
- 31% — North American heavy-truck share
- ~19.5× — Forward P/E (8/13/2026)
- $8.7B — Net cash (Q2 2026)
VOL 1 • ISSUE 10 • SEPTEMBER 2026
Kenworth and Peterbilt are what PACCAR sells. Parts for the trucks already on the road just set a record.
PCAR • INDUSTRIALS • INDEX CONSTITUENT
This Issue — PCAR
PACCAR, a current Nasdaq-100® constituent at ~0.30% index weight, builds Kenworth, Peterbilt and DAF trucks and earns on them twice: PACCAR Parts supplies the fleet already working, and PACCAR Financial Services finances and leases the trucks its dealers deliver. Because PACCAR designs and builds its own engines, every truck delivered adds to the pool of vehicles its parts business serves (per company disclosures). Truck orders follow the freight cycle; parts demand follows the fleet. The manufacturing side runs with no net debt, unusual in an industry this capital-heavy.
Business Model & Revenue Drivers
What PACCAR Actually Sells
The product is a truck: Kenworth and Peterbilt in North America, DAF in Europe, built across the light-, medium- and heavy-duty range with Class 8 heavy trucks at the center. Trucks are the bulk of revenue, and they move with freight demand. Around 25,900 employees build them (per company disclosures).
Two smaller businesses change the shape of the earnings. PACCAR Parts ships aftermarket components through the dealer network to trucks already working, and PACCAR Financial Services finances and leases trucks for customers and dealers. Both bring higher-margin, more repeatable revenue than truck assembly, and both kept growing in 2024 while truck revenue fell.
Parts revenue, 2022 vs 2024: $5.76B → $6.67B.
Competitive Moat
Why This Is Hard to Replicate
PACCAR holds 31% of the North American heavy-truck market, second behind Daimler Truck by market share (per Bloomberg research). Kenworth and Peterbilt are premium brands sold through independent dealers, and PACCAR's own diesel engines sit in a growing share of the trucks on the road, which is what feeds the parts business (per company disclosures).
The cost side reinforces it. PACCAR runs a lean organization and leaves the retail network to independent dealers, so selling and administrative costs run well below peers as a share of sales (per Bloomberg research). Aiming for one point of additional North American parts share each year through 2030 works the same asset harder rather than adding a new one.
North American heavy-truck market share: PACCAR 31% • All others 69%.
Operating Strengths
Three Structural Advantages
- 90%+ of US Class 8 trucks built domestically. Section 232 tariffs on medium- and heavy-duty trucks favor domestic production, and PACCAR is one of few makers with this footprint (per Bloomberg research).
- $2.96B free cash flow (TTM, Q2 2026). Funds a $725–$775 million capital program and $450–$500 million of R&D planned for 2026 without leaning on the manufacturing balance sheet.
- A1 / A+ Moody's / S&P credit ratings. Both stable, with Moody's affirming the A1 rating in July 2026. Cheap funding matters when the lending arm writes the customer's loan.
Growth Catalysts
What Grows the Business Next
The 2027 emissions rules are the near-term story. Fleets historically buy ahead of a new emissions standard, and management expects the US and Canada Class 8 market to strengthen before EPA27 takes effect, which represents potential upside for a maker that builds its own engines. PACCAR maintained a 2026 US and Canada Class 8 retail outlook of 230,000–270,000 trucks and estimates a European market of 280,000–320,000 units (company guidance).
- Order momentum. Preliminary US Class 8 net orders reached 38,200 units in March 2026, more than double the year-earlier level, as freight volumes improved and tariff and emissions uncertainty faded (per Bloomberg research).
- A fuller backlog. Build slots were reported full for Q2 2026 and mostly full across Q3 and Q4 globally, and consensus expects earnings of about $5.96 per share in FY2026 (Bloomberg consensus estimates).
- Parts and new powertrains. A larger installed base of PACCAR engines and a wider proprietary parts range support continued parts growth, while the Amplify Cell Technologies battery plant in Mississippi is scheduled to start producing lithium-iron-phosphate cells in 2028.
Historical Context
2020 – 2024 Revenue Trajectory
+84% revenue growth, 2020 to 2024
Revenue grew every year from 2020 through 2023 as freight demand and truck pricing rose together, and EBITDA margin expanded through that upcycle. 2024 revenue eased as the North American truck cycle turned, with margin still above pre-cycle levels. Parts and Financial Services revenue both rose in that softer year (per company filings). All figures shown are past results.
2020: $17.2B
2021: $21.8B
2022: $27.3B
2023: $33.3B (cycle peak)
2024: $31.6B (cycle turns)
• EBITDA margin (2020 → 2024): 9.8% → 15.8%, +6.0 pts
• Quarterly earnings per share: $1.06 (Q4 2025) → $1.43 (Q2 2026), +35%
• Regular quarterly dividend: $0.27 (early 2024) → $0.35, ~+30%
Source: PACCAR filings, Bloomberg. Past results.
38,200 Class 8 trucks ordered in a single month. More than double a year earlier.
Valuation & Investment Thesis
Priced for an Earnings Recovery
PCAR trades at ~19.5× forward earnings against ~27.2× on trailing earnings, with EV/EBITDA at ~18.6× (8/13/2026, per Bloomberg research). The gap between the two multiples is what consensus expects earnings to close as truck volumes recover through 2026 and 2027.
A buyer at that price gets the parts and financing income, a manufacturing balance sheet in net cash, and a two-year weekly beta of 0.52, meaning the shares have historically moved less than the broad market. The regular dividend is $0.35 a quarter, a 2.13% yield, and PACCAR has added special dividends in December of each of the past two years.
Key Risks
What Could Change the Story
- Cyclicality, since truck demand can reverse abruptly and PACCAR's revenue is closely tied to it.
- Parts growth deceleration, after the company trimmed the upper end of its parts growth expectations following Q2 2026 (per Bloomberg research).
- European competition, which led to a medium-term European share target of about 18%, down from 20%.
- Alternative powertrains, a longer-term threat to both truck share and the parts and service revenue tied to diesel engines.
- Product launch timing, with some 2027 product introductions delayed for further performance validation.
What This Means For You
The Index Angle, in Plain Terms
In your index fund — If you hold a fund that tracks the Nasdaq-100 Index®, you already own this.
- Index composition follows transparent eligibility criteria, and PCAR is a current constituent at ~0.30% index weight: roughly 30 cents of every $100 tracking the Nasdaq-100 sits in PACCAR.
- If you have watched a Kenworth or a Peterbilt haul a trailer down an interstate, you have seen the product. Most of the goods on store shelves arrived on a heavy truck.
- PACCAR earns on that truck long after it is delivered, through the parts its dealers sell and the loan that paid for it.
Decoding the Jargon
Two terms doing the heavy lifting in this issue.
- Class 8 (heavy-duty truck). The largest highway trucks, the tractor pulling a full-size trailer. PACCAR holds 31% of that market in North America, so the industry outlook of 230,000–270,000 units for 2026 sets the size of its core opportunity.
- Forward P/E (price to expected earnings). At ~19.5×, the price today is about 19.5 times what analysts expect PACCAR to earn over the next year. It sits below the ~27.2× on the last twelve months because those expectations are for higher earnings.
Bottom Line
Inside the Nasdaq-100®, PACCAR gets paid when a truck ships and again for as long as that truck runs. The first depends on the freight cycle, the second on the fleet already on the road.
About the Series
The Nasdaq-100® is a globally recognized index of 100 of the most innovative large cap companies listed on the Nasdaq Stock Market®. The Inside the Index series profiles one constituent each issue, from software to soft drinks and computer chips to potato chips, exploring what makes each business distinctive and the metrics investors should know.
Sources
Nasdaq Global Indexes. PACCAR Inc SEC filings via SEC EDGAR: FY2024 Form 10-K, Q2 2026 Form 10-Q; PACCAR Investor Relations. Segment revenue, quarterly results, dividends, capital and R&D plans, product and industry outlook per PACCAR company disclosures. North American and European market share, domestic Class 8 production share, Class 8 order data, credit ratings, valuation multiples, beta and forward estimates per Bloomberg Research and Bloomberg consensus estimates. Data as of 8/13/2026.
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