Buffett Brain · Research note
Score updated 22 Oct 2026 · analysis from 24 May 2026
PCAR· Industrials
Paccar
PACCAR's financial health is robust, but its margins and ROIC lag behind top-quintile industrial peers, raising questions about its moat.
Buffett fit
Partial fit
Owner
21
Durability
55
Management
47
Price
48
Score updated 22 Oct 2026 · analysis from 24 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Industrials stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Owning PACCAR privately would involve navigating a competitive and capital-intensive industry, with a focus on maintaining market share and operational efficiency.
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PACCAR has been profitable for the past five years, but its EPS growth of 6% annually is modest.
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PACCAR's management has maintained a stable share count with a CAGR of 0.21% and a minimal yield of 0.02%.
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PACCAR's of 23.5 and EV/ of 22.7 suggest a premium valuation, with an yield of 5.22% below the 8-10% target for a no-brainer entry.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1Interest coverage ratio of 123.7 indicates strong ability to service debt.
- 2Dividend CAGR of 33.77% reflects a commitment to shareholder returns.
- 3 to net income ratio of 1.28 suggests high earnings quality.
- 4Current ratio of 3.11 provides a strong liquidity position.
Concerns
5- 1 of 5.87% is below sector top-quintile, indicating limited capital efficiency.
- 2 of 15.11% is significantly below the sector p80 of 43.7%, reflecting weak .
- 3Net debt/EBITDA of 2.75 exceeds the preferred threshold of 2x, indicating concerns.
- 4 of 23.5 suggests high valuation relative to growth prospects.
Price history
$110+90.0%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
PACCAR Inc designs and manufactures commercial trucks under the Kenworth, Peterbilt, and DAF brands, generating revenue through vehicle sales, parts distribution, and financial services. The Truck segment is the largest, but the Parts and Financial Services segments provide steady recurring income. The company’s of 15.1% is below the sector top-quintile cutoff of 43.7%, indicating limited and competitive pressure. Unit economics are challenged by capital intensity and competitive pricing.
What other investors would say
The same company, judged by three other documented playbooks.
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